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Monday, November 6, 2006 - Page updated at 06:41 AM

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Updated Microsoft Office ships to factories

Seattle Times technology reporter

Microsoft is marking the completion today of a new version of one of its two most profitable products, the set of applications called Office.

The company said the 2007 Office system — a name meant to reflect the broad set of programs from the familiar word processor and spreadsheet to new tools for collaborating and other tasks — will be released to manufacturing (RTM) today.

"We've crossed the development finish line, and the team deserves to celebrate," Jeff Raikes, president of the Microsoft Business Division, said in a statement.

After three years of work by about 2,000 software developers, the milestone signals that the programming code for the product, responsible for more than half of Microsoft's profits, has been finalized.

This "gold code" — running to tens of millions of lines, though Microsoft did not disclose an exact number — will be burned onto disks for distribution.

Microsoft said last week it plans to give business customers Office 2007 and the long-awaited and repeatedly delayed Windows Vista operating system on Nov. 30. Exchange Server 2007 will also be available at that time.

Office was scheduled to be available in October, but Microsoft in June announced a delay to correct "product performance" issues raised in testing.

Consumer availability of Vista and Office 2007 is set for January, though the company has not yet announced a specific date. RTM of Vista is expected sometime this week.

"Microsoft shipping Vista and Office 2007 is great for the company and an important milestone for its customers," Michael Silver, a research vice president at Gartner, wrote on a blog posted Friday.

He cautioned organizations that deploy the new software to "expect a stream of fixes for the first few months after availability."

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He also recommended they check that their other software is compatible with the new versions of Office and Windows.

"Microsoft beat the expectations of many in the industry, so the rest of the ecosystem is still catching up," Silver wrote.

The last version of Office was released in 2003. The franchise has grown to include 14 separate desktop programs and eight programs for computer servers that handle tasks such as e-mail and business intelligence.

Today, competitors are emerging for some parts of the Office system in the form of advertising-supported word processing and spreadsheet applications delivered over the Internet by Google and others.

These offerings, targeted at consumers and small businesses, have fewer features than their Microsoft counterparts and have yet to gain widespread usage.

But they do represent competition that wasn't there three years ago.

Raikes, who will celebrate 25 years with Microsoft next week, said Office 2007 includes "the most significant improvements to the products in more than a decade."

It has a new "ribbon" user interface, replacing the menus and toolbars that have been part of the system for several generations. The ribbon is to help people find and use more of the products' features in fewer steps.

Office is part of Raikes' Business Division, which generated operating income of $9.61 billion — more than 58 percent of Microsoft's total — on revenue of $14.48 billion in the most recent fiscal year.

About 500 million people around the world use Office. Some 3.5 million downloaded earlier test versions of Office 2007 and gave Microsoft feedback on its performance.

Benjamin J. Romano: 206-464-2149 or bromano@seattletimes.com

Copyright © 2006 The Seattle Times Company

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