The week's not off to a great start for Microsoft. On Monday, a European court upheld almost $1 billion in antitrust penalties against the software maker. A day later, it's IBM that is taking aim at Microsoft with the release of a free office software suite called Lotus Symphony.

IBM said Tuesday that Symphony, based on open source software from the OpenOffice.org project, will be made available as a free download essentially to whoever wants it. The package contains a word processor called Lotus Symphony Documents, as well as Lotus Symphony Spreadsheets and Lotus Symphony Presentations. IBM is calling the suite "enterprise-grade productivity software" and points out that it's based on many of the same tools found in its pricey Lotus Notes 8 e-mail and collaboration platform.

Because it's free, Lotus Symphony could present a significant challenge to Microsoft's new Office 2007 suite in the market for office productivity software. Some commercial software buyers have expressed concerns about Office 2007's price and compatibility with older applications. The software is based on a new format developed by Microsoft called Office Open XML. Earlier this month, the format failed to gain fast track approval from the International Organization for Standardization.

As an Open Office derivative, Lotus Symphony employs the Open Document Format to ensure cross-application portability of data. ODF is an approved ISO format, a fact that appeals to many enterprise software buyers -- particularly those in the government market. "With the Open Document Format, businesses can unlock their information," said IBM software chief Steve Mills, in a statement.

Earlier this month, IBM said it would donate portions of the Lotus Notes code to OpenOffice.org, which governs the Open Office project.

To date, Open Office has failed to put much of a dint in Microsoft's multi-billion dollar office software business. However, that could start to change in light of Monday's announcement. IBM said it has tasked 35 programmers with creating enhancements for Symphony. Because it's an open source project, those enhancements will be made available to other vendors that offer versions of Open Office, including Sun Microsystems.

IBM's Symphony announcement takes a page from the company's Linux playbook. Big Blue is a significant backer of the open source operating system, though it derives no direct revenue from the software. Rather, IBM has created an ecosystem of customers and partners that buy IBM's commercial middleware products to tie together systems built on Linux. The strategy not only boosts demand for IBM middleware, it also denies to Microsoft some valuable market share. IBM now appears to be adopting a similar strategy in the desktop market.

OpenOffice isn't the only challenge to Microsoft's dominance in the productivity software market. Google recently entered the fray with an array of hosted applications sold as a service under the Google Apps brand. Earlier this month, outsourcer Capgemini said it would add support for Google Apps Premier to its service offerings.