Microsoft unveils Office 11

Microsoft Corp. has begun beta testing the next upgrade to its hugely popular Office productivity suite, due to ship in mid-2003 with enhanced collaborative tools and XML support.

Of the applications, Outlook gets the biggest renovation. Most of the applications will look and act much as they currently do. Under the hood, however, all have some important changes that could eventually have far-reaching impact for consumers and businesses alike.

The suite is currently called Office 11, although Microsoft says that is a code name. The first beta is private; a public beta is slated to follow early next year.

The company has given numerous previews of the updated suite, but a few features are still a surprise.

The biggest overhaul is that Word and Excel will support XML-based file formats. So will Microsoft Access, which is part of the standard configuration of the suite (but not the professional edition). This will allow documents to incorporate data from any XML-compatible source (and also allow different presentations of data via XML-compatible templates). Microsoft is, in effect, making good on its .Net promises (and some say it wouldn't be surprising to see Office 11 shipping as Office .Net).

Initially, this move will most benefit corporate enterprises that would welcome tighter integration between non-Microsoft server applications and Office. For example, until now, they may have had to transfer information manually from industrial-strength Oracle databases and the like to their Office documents, and vice versa.

With Office 11 you can link fields in an Excel spreadsheet, for example, directly to such a database, provided it has an XML interface--which most do, as XML is an open standard.

Eventually, even individuals who don't work for large companies will find Office 11's new XML support useful, says Forrester Research Inc. analyst Frank Gillett.

That's because businesses of all kinds are expected to generate online forms using XML-enabled Word and Excel. These downloadable forms will be a convenient, easy-to-use alternative to today's Web forms: If you've ever made a mistake filling out an online form and had to start over from scratch, you'll find working offline in Word or Excel and then submitting the completed form via the Web much less irritating.

Also, the XML-enabled Word or Excel file can remain "live," so if you have to correct something, such as an address or phone number, you can simply make the change in your document and the information will be updated in the associated databases.

"Office [the new version] will become more valuable to individuals as organizations take advantage of these new features," Gillett says, adding that he expects this won't happen until at least 2004.

This switch to an XML-based suite should significantly boost Microsoft's sales of Office, Gillett adds, but is in one respect a risky move: Because XML is an open standard, the new format will be completely open to competitors, who will be able to perfectly reproduce Office formats.

While many apps have offered the capability to generate Office-compatible documents, they have never produced completely identical documents. But Gillett says there will be nothing to stop a Linux word processor from producing a document in the new Word format.

That could not only be a boon to some of Microsoft's competitors, it could also put pressure on the price of Office, Gillett says. Still, the company expects to gain more in volume sales than whatever it stands to lose in profits on each individual unit.

The XML support in the Office suite is separate from Microsoft's recently announced XML product, code-named XDocs. That application will provide tools to design, edit, and view XML data, with emphasis on its use in form creation and management, according to Microsoft. Although considered part of the Office family, it will not be part of the suite, Microsoft says. XDocs is expected to ship in the same timeframe as Office 11.

A set of Office changes that more squarely address enterprise users has to do with workgroup collaboration. Microsoft is enhancing Office's integration with version 2 of its SharePoint Team Services workgroup application. Workers will be able to share documents in real time, and keep better track of different versions of the same document.

Outlook boasts a new, streamlined look and some useful gizmos for managing e-mail. The inbox and preview pane, instead of being stacked horizontally, are now each in a vertical column, which uses space more economically.

You can assign colored flags to messages that you wish to identify for later follow-up. Improved search features include the capability to save parameters and results to folders.

The updated Office suite also includes functions designed to improve the programs' support for Tablet PCs.

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