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11/30/2006
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Microsoft Launches Vista, Office; 30 More Products On The Way

Microsoft plans to spend more to promote the new products than it devoted to its landmark Windows 95 and Office 95 software 11 years ago.

Microsoft will spend hundreds of millions of dollars to market its new versions of Windows and Office and plans to release more than 30 additional business products in the next year that piggyback on their technology, CEO Steve Ballmer said Thursday in New York.

During a press conference at the Nasdaq stock market in Times Square to launch business versions of its Windows Vista, Office 2007, and Exchange Server 2007 software, Ballmer said Microsoft would spend more to promote the next products than it devoted even to its landmark Windows 95 and Office 95 software 11 years ago. "This is the biggest launch we've ever done," he said. New consumer versions of Windows and Office will appear Jan. 30.

Companies, including Verizon Communications and Viacom's MTV Networks, plan to install Windows Vista on thousands of new PCs soon, and Microsoft expects 200 million PC users to have one of its three new products on their desktops by year's end. Windows and Office are Microsoft's most important products, accounting for more than half of its $10.8 billion in revenue during the first quarter ended Sept. 30, and their profits help float other parts of the company.

But Windows Vista has been mired in delays; its debut comes more than five years after the release of Windows XP, Microsoft's last desktop operating system. "It's an exciting thing to finally be here," Ballmer said.

With this version of Windows, Microsoft is introducing more higher-priced and feature-laden editions, which could help Microsoft's revenue from desktop Windows grow 9% to 10% during the current fiscal year, slightly ahead of overall PC market growth of 8% to 10%, according to a research report issued this month by analyst Jason Maynard at Credit Suisse. Maynard forecast that Microsoft shares would rise to $35 within a year, from about $29 today. But the company faces tough competition from Google, Apple Computer, Salesforce.com, and others, he said.

During his keynote speech, Ballmer brought on stage Microsoft managers who demonstrated the ability of the new versions of Windows, Office, and Exchange to help companies manage communications among employees, analyze data, and find information. "Giving people better tools to do their jobs is a bigger deal today than ever before," he said.

The demos included Vista's information-seeking Sidebar, a newly designed Windows Start menu that consolidates commands and incorporates new desktop and network search-engine software, and the ability to use an on-screen calendar to graphically search for documents based on when they were created. Microsoft also showed the ability to use an add-on to Exchange called Outlook Voice Access to check e-mail and voice-mail messages and manage a user's calendar with voice commands.

Ballmer said Microsoft plans to deliver more than 30 additional business products in the next year that add other capabilities to Windows, Office, and Exchange. Those include add-ons to Office for data mining and real-time communications, security and management products for Windows, and new Internet phone-calling and video-conferencing products. "There's a bunch of additional innovation," said Ballmer.

Ballmer also said Vista won't be the last compelling version of Windows for PCs. Future versions will add technologies for networking and video playback, take better advantage of the power of multicore chips from Intel and Advanced Micro Devices, and aim to combine desktop and online software in new ways. Said Ballmer, "We will continue to do exciting new releases."

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