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10/1/2013
12:27 PM
Mike Feibus
Mike Feibus
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Microsoft's Office For iOS, Android Dilemma

It looks like Microsoft will port its omnipresent Office productivity suite to iOS and Android. Now comes the hard part.

Microsoft finally has given us a sign that the company understands its enterprise hegemony is at risk – and that it intends to do something about it. At their financial analyst gathering last month, executives dropped strong hints that the company is developing Outlook for the iPad and Android, although they didn't come right out and say so.

No question that such a move is long overdue. Office dominates business productivity, though it's under attack from Google Docs and other cloud-based services. And the longer it takes to protect that turf with moves like porting Office to other platforms, the larger the threat becomes.

But in fairness to Microsoft (did I just say that?), the issue is so knotted up in a web of competing company interests that I'm surprised that executives are able to do anything. Indeed, one of the more difficult challenges any executive faces is how to make and manage decisions that benefit one internal group at the expense of another. The rational option, at least from a pure market potential point of view, is usually pretty apparent. The difficulty comes in trying to navigate all the beehives around the organization that you'll be poking with your chosen direction. Imagine telling one of your kids that you love his sister more than him. If you can picture saying that -- and what it would do to your day -- then you've got a feel for management's challenge.

[ What else is happening with Office? Read Microsoft Creating New Office Touch Apps. ]

The dilemma for Microsoft with its Office decision is that versions for iOS and Android would weaken Windows' market position because it would hand to competing tablet platforms what today is an exclusive benefit that comes with choosing Windows. And it's not as though Windows' place in computing is so secure that in can afford to lose that. Many of its problems have been self-inflicted, yes. But the onslaught of tablets undoubtedly has contributed to the platform's state, which is shakier now than at any time since a superior DOS from Digital Research threatened the transition to Windows.

So what to do? Prop up Windows or let Office address the entire market? If what they've hinted is true, then Microsoft execs have made the right choice here. The rule of thumb for this kind of management dilemma is this: never clip one product's wings for the sake of another or you'll end up weakening both.

Microsoft's problem is a little different than your typical which-kid-do-you-love-more dilemma, because Office and Windows are roughly the same age and because they address more or less the same markets. Usually, the choice comes down to opting for entrenched or emerging. Old or new. Profits or promise.

That the type of challenge that Intel, Microsoft's platform partner, is facing: how to prioritize Atom, the processor family aimed at smartphones and tablets, and Core, the PC processor lineup. Brian Krzanich, Intel's new CEO, thus far has been clear in articulating his priorities. He's been careful to avoid saying that the company is focusing less on Core, though he has been unwavering in his assertion that he will give Atom every opportunity to shine.

In July, during Krzanich's first earnings call as CEO, one financial analyst asked him what he was doing to keep Bay Trail, the code name for the newest Atom chip, from cannibalizing Core sales. "At the end of the day, the market will go where the market goes," he said. "Better to have a product like Bay Trail so that we can play no matter where it goes rather than miss the market."

That's spot on. Again, though, it's easier said than done. I've been watching Krzanich at every turn to see if he conveys the same message -- and thus far he has. But again, that's the easy part. If an industry analyst like myself is watching this closely, then you can imagine how intently employees are hanging on his every word.

As it happens, propping up Bay Trail also helps Windows, because the new chip helps the platform to reach lower price points and also offer battery life that consumers expect in a tablet. So in this case at least, one company's dilemma is another company's windfall.

In the long run, the expected Office ports will be good for Windows because it will force the platform to compete without the crutch of a go-to productivity suite. It will be a difficult lesson to master in the meantime. But as any parent can tell you, every kid sooner or later has to learn how to make it in the world without you. Windows has been playing in the mainstream market for 23 years now. Seems to me that's as good an age as any to go figure out how to do that.

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melgross
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melgross,
User Rank: Ninja
10/2/2013 | 4:05:55 PM
re: Microsoft's Office For iOS, Android Dilemma
It's no doubt a difficult question. But the horse may already have left the barn. We have a couple of hundred million people with 10" tablets (the smallest size considered to be useful for productivity) writing with other tools. In fact, Apple's iWork's is the most popular suit for mobile. They will have a major upgrade this fall, and now will shortly have heir own version on the Internet, competing with Google and Microsoft.

Additionally, with the iPad being, by far, the most popular business and government tablet, and iWork being free with all new purchases, and even now, the suite costing in total, about $30, the question is how Microsoft can convince people why their suit is so much better, at what will likely be a far higher price point. Considering that the old joke about Office is that 80% of the users use 20% of the features, it may not be that desirable. If true, what will Microsoft need to price this at?

It seems that now Apple is turning Microsoft's old tricks against it, which is that of giving something away for free that they have to pay for elsewhere. And just like Microsoft before it, Apple can afford it.
AustinIT
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AustinIT,
User Rank: Apprentice
10/2/2013 | 5:15:33 PM
re: Microsoft's Office For iOS, Android Dilemma
This is an easy one to call: Should Microsoft (in the short term) port Office so it will run on competing OS and hardware platforms? NO.

Reason: If you lessen the need for a Windows Client, then it ultimately lessens the need for the Server OS and all the management tools and applications that run on it. All the while never really knowing what sort of the pie Office will even gain on those competing platforms.

Seems to me that it would be a huge gamble to make Office available on other platforms Before they get Windows running correctly (and well accepted by customers) on the new paradigm.

btw - If customers only need 20% of Office features, they can run the Web App versions today for free.
TerryB
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TerryB,
User Rank: Ninja
10/2/2013 | 5:17:44 PM
re: Microsoft's Office For iOS, Android Dilemma
I don't know anything about iWorks so here is the question: I'm sure it does a good job of letting you write something but who can read it (besides another Apple) when you send it to them? Meaning what is the file type of the equivalent Word, Excel, Powerpoint in iWorks?
That has always been the reason Office has dominated in business, your chances were pretty good that most people could read what you created.
That started to change with Sun OpenOffice being able to at least read Office docs even if it could not (initially) save in that format. Now with more products having ability to save in PDF, maybe this issue is going away? Well, at least for Word, having PDF of Excel or Powerpoint kind of defeats purpose of those formats.
Laurianne
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Laurianne,
User Rank: Author
10/2/2013 | 7:16:57 PM
re: Microsoft's Office For iOS, Android Dilemma
"No question that such a move is long overdue." Is it too late?
Michael Endler
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Michael Endler,
User Rank: Author
10/2/2013 | 8:20:58 PM
re: Microsoft's Office For iOS, Android Dilemma
I think this articulates Microsoft's position pretty well. When people talk about multi-billion dollar opportunities for Office on iOS and Android, it sounds like a lot of money. But Office props up not only Windows but also Server--which represents an even more gargantuan chunk of money.

The question is whether Microsoft takes so long getting Windows in order that the appeal of an iOS/Android version of Office evaporates, replaced by iWork and others.

I don't think Microsoft has crossed the rubicon yet, but I think some of its future choices have been impacted. Can Microsoft get away with waiting until some time in 2014? Yes, I think so-- unless the new version of iWork is more jaw-droppingly awesome than anyone of us expect it to be, or unless some other unexpected disruption jumps up.

Can Microsoft dare to make the iPad version available only through Office 365 subscriptions? I don't think that's a great call. Can Microsoft charge $100 or even $30 for a standalone license, now that iWork is free? Sure, they can, but it probably wouldn't go over well.

I really think Microsoft is going to wait to see how Windows 8.1 does. If it's still trending upward in January, Microsoft will feel pretty confident about releasing Office on its own terms. If it's not doing much better than Windows 8 has done, that could be another story.

As for the Web apps, they're definitely under-appreciated. But I don't think they'll ever be a widely accepted iOS/Android solution.
Michael Endler
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Michael Endler,
User Rank: Author
10/2/2013 | 8:32:05 PM
re: Microsoft's Office For iOS, Android Dilemma
That's one big obstacle. iWork does an okay but not great job of playing with Office. The new version that's supposed to debut this fall (maybe when OS X Mavericks comes out) might be better.

But even if the next version of iWork does a perfect job ingesting and outputting compatible files, Office would still retain other advantages, such as the ease with which documents can be shared. iWork's Numbers has nothing like Power BI for Excel either. These concerns are more enterprise-oriented than consumer-oriented. But they also show why Office's position in the enterprise is pretty entrenched, even if a lot of consumers start flocking to iWork.
Thomas Claburn
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Thomas Claburn,
User Rank: Author
10/2/2013 | 10:06:53 PM
re: Microsoft's Office For iOS, Android Dilemma
Given existing options like QuickOffice, I'd say so.
Shane M. O'Neill
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Shane M. O'Neill,
User Rank: Author
10/2/2013 | 10:18:47 PM
re: Microsoft's Office For iOS, Android Dilemma
It's getting close. Microsoft's nightmare scenario: Office alternatives really take hold on iOS and Android while Windows 8/8.1 continues to stumble badly on tablets.
MFeibus
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MFeibus,
User Rank: Strategist
10/2/2013 | 11:55:14 PM
re: Microsoft's Office For iOS, Android Dilemma
You all are right. The server arguments are definitely valid. But we could go around in circles on this, because it's all so interconnected. The key here is that Windows 8.x just isn't keeping users around. It certainly isn't enticing new ones. That weakens Server's hold regardless of the exclusivity of Office.

The fact is, you can only tie users down for so long to something when they'd rather have something else. Eventually, they'll find a way around. Just ask Blackberry. They thought that their services gave them a lock on the enterprise. It worked for a little while, until execs who wanted iPhones told IT to make it happen. And that was that.

Correct me if I'm wrong on this point (read: don't correct me on anything else but this point!), but it seems to me that MS Exchange Server offers the biggest discernible end-user benefit out of the entire Server suite. I think that those who make use of inter-company calendar invites, for example, are beholden to Outlook for those. So wouldn't porting Office to the other tablet platforms strengthen Exchange's position?

But again, if Windows 8.x was alluring to end users, all of this would be moot. Unfortunately, it's all very relevant.
AustinIT
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AustinIT,
User Rank: Apprentice
10/3/2013 | 11:53:42 PM
re: Microsoft's Office For iOS, Android Dilemma
BYOD has been a HUGE disrupter in the overall tech market. It has certainly destabilized the once venerable and consistent enterprise market.

For a company in Microsoft's position, it is just as dangerous to chase the consumer market as it is to ignore it. People are fickle and trendy. That's makes it very dicey when it comes to staking your business' future on tech devices and software. You have to be a fortune teller (or employee a good one) in order to gauge where the market is going and hope that you can execute well to capitalize on it.

Exchange is a great product and widely used. But so is SQL and a legion of other management apps that run on Server. So, it's a very valuable market. With Exchange moving more into the cloud (Office365), it reduces the number of Microsoft Exchange Servers that will be required.

You are correct on the point about getting other platforms on Office as they would need that backend infrastructure. This is why Microsoft has been pushing Office365 subscriptions on iOS to capture that element.
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