A startup working in Microsoft's backyard is taking aim at the software giant's entrenched project management software with a new hosted service.

LiquidPlanner's offering went into public beta on Monday. Despite the popularity of programs like Microsoft Office Project, such applications don't deal with project uncertainty well enough and don't even get used much, said Charles Seybold, CEO of LiquidPlanner, based in Bellevue, Washington.

"We think Microsoft Project is the world's greatest shelfware," Seybold said.

Instead of predicting a project's completion date by adding up fixed, estimated times for the various tasks involved, LiquidPlanner has users enter ranges based on best-case and worst-case scenarios. The company has developed what it calls a "probabilistic scheduling engine" that it claims can judge the likelihood a given task or project will be done by a certain date.

"We don't think people are going to schedule any way besides probabilistic in the future," Seybold said.

The application, built with the popular Ruby on Rails Web development stack, displayed a streamlined, Web 2.0-style interface during a demo. Users get personalized dashboards for viewing updates, managing tasks and receiving problem alerts.

It also incorporates facets of social networking, including a wiki-like commenting feature and document sharing. Since the service is hosted, it is easy for project teams to grant access to third-party or offshore workers as well, LiquidPlanner said.

Seybold formed the company along with Jason Carlson, its vice president of engineering, in March 2006. Both men previously worked at Expedia.com, which used project management tools developed in-house.

Forrester Research analyst R. "Ray" Wang praised the startup's effort.

"They've really gone to the trouble of allowing users to enter more realistic upstream estimates so that downstream project scheduling is accurate. This means accurate promise dates, easier tracking and reestimation, and better forecasts," Wang said in an e-mail message.

As LiquidPlanner debuts, however, it is entering a space crowded not only by Microsoft but other offerings, such as Basecamp and Vertabase.

Its work to bring a viable product to market has been the subject of an ongoing, behind-the-scenes chronicle by the Seattle Post-Intelligencer. LiquidPlanner is showcasing the application at this week's DEMO conference, a key stop for venture capitalists, in Palm Desert, California.

The software will be free during the beta period. Following that, the service will remain free for the creator of a "project space" on LiquidPlanner's servers, but additional members will have to pay US$24.95 each per month.