Chinese Startup Takes Aim At Microsoft Office

Evermore Software hopes to carve out market share in China and perhaps take a sliver in other countries with its office-productivity suite.
SAN JOSE, Calif. (AP) -- It took Gus Tsao nearly nine years to raise enough money to launch his China-based technology startup, Evermore Software LLC.

Now the 59-year-old immigrant is poised for an even tougher mission: beating Microsoft Corp. in the Chinese market for office software, and maybe taking a tiny bite out of the Redmond, Wash.-based giant's dominance elsewhere.

"Everyone thinks I'm crazy to take on Microsoft, but China is not going to pay Microsoft forever with their prices," Tsao said.

Born in Chongqing, China, Tsao emigrated to the United States in 1968 and became a U.S. citizen in 1989. He founded Evermore in 1999 after his spreadsheet startup failed 11 years earlier.

He claims his Evermore Integrated Office, or EIOffice, is better than Microsoft Office when it comes to integrating the assorted word processing, spreadsheet and presentation applications. EIOffice lets a user change, say, a sales figure in a spreadsheet and have it automatically changed in related reports.

Unlike Microsoft Office, in which different applications have separate user interfaces, Evermore puts all the components into a single application to create what it considers a more streamlined method of working.

On the surface, EIOffice looks a lot like Microsoft Office with its toolbars and drop-down menus. But a key difference is its slick navigation panel, which lets users easily maneuver between applications.

Still, the odds against Tsao's little-known company from Wuxi City, China, are high. Getting large enterprises to switch from Microsoft Office is an enormous task, given the major costs associated with a systemwide change.

Even established Microsoft Office rivals--StarOffice from Sun Microsystems Inc., SmartSuite from IBM Corp., and WordPerfect Office from Corel Corp.--have managed to take only a sliver of the market for business desktop computers. Combined, Microsoft alternatives have less than 10 percent of the market, according to independent research firm Directions on Microsoft.

Evermore's software was launched last August in China, where Microsoft Office reigns, in both legal and pirated versions.

But the country of more than a billion people has a large untapped customer base--not to mention an increasing appetite for the open-source Linux operating system and for technologies homegrown in China.

Evermore's software works on Windows and Linux-based machines. Versions for Sun's Solaris and Apple Macintosh computers are planned, Tsao said.

Microsoft rivals generally have tried to attack Office on price. StarOffice, for instance, is based on the free, open-source OpenOffice program, and costs $79. Microsoft Office ranges from $149 to $499, depending on the edition.

EIOffice is available for lease at $99 per year or $249 for three years. Education customers may get discounts.

With big corporate technology budgets still somewhat tight, Microsoft's rivals--including Evermore--are targeting government agencies and small- to medium-sized businesses with a greater willingness to experiment.

Though Evermore has yet to gain traction in China, the privately held company is aiming for other countries. A new English-language version of EIOffice will be launched in the United States next week at DEMO, an elite tech show. According to Jupiter Research analyst Joe Wilcox, about 16 percent of U.S. businesses with fewer than 1,000 workers have yet to adopt office productivity software, so there's some room to compete at that level.

Organizers of DEMO say Evermore is the first Chinese firm selected to participate in the show's 14-year history.

EIOffice will not topple the Microsoft Office dynasty--which is 400 million users strong--but it can please the increasing number of customers looking for alternatives, said Chris Shipley, DEMO's executive director.

"It's a very elegant piece of software," Shipley said. "But can this company no one has ever heard of be a competitor to Microsoft? My answer is yes."

Tsao's previous startup, Daybreak Technologies Inc., made a spreadsheet program called "Silk." The business failed, despite industry accolades, and went bankrupt in 1988.

A few years later, Tsao started looking for investors for his new idea, but couldn't drum up enough capital.

His big break came from the Wuxi New District Economic Development Group, the investment arm of the local government in the city of 4.3 million along China's southeast coast. Evermore now has an initial investment of more than $5 million and a staff of about 250, mostly in Wuxi.

"Our problem now is the marketing, the promotion of our solution, to let people understand it is not just another Office--it's the next-generation office product," Tsao said.

Whether Evermore becomes even a modest threat, Microsoft executives say they aren't worried. To them, it's simply another company among dozens fighting for the office software market.

"We've done well against all of them because we're not focused on them but our products," said Dan Leach, a manager in Microsoft's information-worker product group.

Curtis Sasaki, Sun's vice president of desktop solutions, which is also making inroads in China, wishes his smaller rival luck.

"We've learned over the last five years it takes a lot of patience, resources, and energy to build awareness, channel, and support programs in this space,'' Sasaki said. "But people are looking for alternative products, and the time is now."

Tsao is ready for a long journey.

"It'll take time, yes," he said. "In the meantime, we'll perfect our product."

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