Vista Languishes But Not Office 2007

Windows Vista may be getting a chilly reception in the enterprise, but Office 2007 has been catching on like gangbusters.

Windows Vista deployments at enterprise IT shops may be sluggish, but that's not the case for Office 2007, according to a new study by analyst firm Forrester Research.

Indeed, while most media attention has focused on Vista's trials and tribulations, Microsoft's (NASDAQ: MSFT) Office 2007 is doing just fine, thank you very much.

"In a nutshell, most customers plan to move forward with Office 2007 on the desktop in the next 12 months," Kyle McNabb, a principal analyst and research director at Forrester, told InternetNews.com.

McNabb may be understating things in regard to enterprise IT shops' plans. Of the IT decision makers queried for the study, of those who plan to implement Office 2007, some 93 percent said their aim is to deploy some part of the suite – either desktop or server applications, or both -- in the next 12 months.

The survey, titled: "March 2008 North American And Western European Enterprise Microsoft Office 2007 Adoption Online Survey" was based on responses from 259 IT decision-makers, according to a Forrester slide deck. As an example of Office 2007's popularity, 243 of the 259 said they will be upgrading within the next five years.

The study of North American and Western European enterprises found that 43 percent of IT shops that were surveyed already have Office 2007 in use. While Office XP still holds sway with use inside some 60 percent of enterprises, followed by Office 2003 with 46 percent, Office 2007 has made a dramatic entry given that it has been on the market for less than a year and a half (it first became available to volume customers on November 30, 2006, the same date as Vista).

One of the things driving rapid uptake of Office 2007 has been its integration with SharePoint Server for document management and collaboration, according to the report. Of 233 survey participants who have plans to upgrade to some part of the Office System server software, 87 percent plan to deploy in the next 12 months.

Additionally, the release of Service Pack 1 (SP1) for Office 2007 in December appears to be triggering IT commitments to migrate to it sooner rather than later.

"That signals that it's okay to deploy [Office 20007]," McNabb said, echoing what has come to be the conventional wisdom that corporate IT departments tend to wait until the first service pack of a new product before beginning widespread deployments.

In the scheme of things, the synergies inherent in the combination of desktop and server components seems to be fueling the trend, he added. However, there are other reasons why customers like Office 2007.

Among features that one analyst views as contributing to Office 2007's popularity is the suite's new "ribbon" user interface – now renamed "fluent" – which changes context graphically as the user performs various work tasks.

"I think the reason a lot of people like it is if you're mouse- and visually-oriented," Roger Kay, president of researcher Endpoint Technologies, told InternetNews.com.

Office has been a cash cow for Microsoft for nearly 20 years and that continues to be. The company's financial reports don't break out Office revenues directly. However, in its second fiscal quarter of 2008, which ended December 31, the company said that the Microsoft Business Division, which includes Office and SharePoint Server as well as Exchange Server, grew revenues 23 percent over the same period last year.

Regarding the ongoing controversy over Office 2007's default file formats – Office Open XML, which just achieved certification by the International Organization for Standardization (ISO) this week – McNabb said it's important to not to lose perspective on what customers deem most important.

"[Decision makers told us that having] an open file format standard is not more important than more fundamental needs like making our people more productive," McNabb added.

TAGS: Microsoft,Vista,Office,Enterprise,OOXML



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