By and large, big business has shunned Windows Vista, and the big question for Microsoft (MSFT) over the next year is: Will the enterprise upgrade to (and buy hundreds of thousands of licenses for) Windows 7, or will they stick it out with XP for years to come?
Microsoft is hedging its bets. The team behind the next version of MS Office — called “Office 14” inside Microsoft, no brand yet — has insulated themselves against the very real possibility of low Windows 7 adoption rates: O14 will run on Windows XP, so it can be sold to corporate clients that shun 7.
That’s what Microsoft Business Software SVP Chris Capossela told SAI in an interview yesterday about Office 14. Chris said:
Our install base of Office 2003 and 2007 is actually quite quite high in enterprises even if XP is what most enterprises are still using on their PCs. We’re looking at XP [for Office 14] with some service pack. We don’t think it makes sense to require only Windows 7 with a new version of Office.
And while Microsoft coordinated to introduce a new version of Office concurrent with the release of both Windows Vista and Windows XP, this time the Office team and Windows group are on totally seperate tracks: We can expect Windows 7 maybe as early as Sept, while Chris still wouldn’t commit to first half of 2010 for Office 14. (CEO Steve Ballmer said last week Office 14 would be delayed until sometime next year.)
The way the Windows 7 and Office 14 teams are working independent of each other is something of a double-edged sword for Microsoft. It’s good for Chris and his business group: They’re working on all kinds of cool new cloud-based features for O14, and if those offerings are valued by Microsoft’s customers it’s great they can buy it whatever version of Windows they’re on.
But here’s the downside: By all accounts, Windows 7 is a conservative, bug-fixing release for Microsoft, with no radical new features other than “touch,” something we still don’t see any use cases for. We think there’s a non-zero number of corporate customers that — in deciding if the ROI on Windows 7 is there — will ask Microsoft if they can still use the upcoming versions of Office, Exchange, and the rest with XP. And when they hear “yes,” we think at least some of them may decide 7 isn’t worth it.