Microsoft News Tracker

Andrew Donoghue at CNET:

Only companies that are signed up to Microsoft’s Software Assurance plan are likely to adopt Office 2007 in the near future because IT managers find it extremely hard to justify an Office upgrade to their board, according to analyst group Gartner.

Speaking at the Midsize Enterprise Summit in Paris on Wednesday, Gartner analyst Annette Jump said research done by the group showed that only about 2 percent of companies that weren’t signed up for Microsoft’s Software Assurance plan had adopted for the previous version of the productivity suite–Office 2003.

Yikes, it’s in the noise level.

The software assurance plan ties companies into automatic upgrades of new Microsoft software at a discounted rate. The plan was updated late last year after coming under fire for allegedly locking users into buying unnecessary Windows upgrades.

And software assurance will in future provide exclusive, specialized operating system versions for businesses ([1], [2]).

Jump added that few companies will be in a rush to deploy Office 2007 immediately, as many have only recently installed Office 2003. Although Office 2007 will run on Windows XP, most companies will probably look to have Vista installed before migrating to it.

“Office 2007 will only catch 10 percent of Microsoft’s installed base by the middle of 2008, as only a small percentage will have moved to Vista by that point,” Jump added.

And despite Microsoft’s claims that Office 2007 will have improved graphical interfaces, the costs of supporting the suite through a help desk will actually increase in the short term as users become acquainted with new features, according to Gartner.

There’s more by following the link, but none of this is really a surprise except to the most starry-eyed. Microsoft’s upside on Office revenue continues to be limited by their own success.