Microsoft shifts main Office product to the cloud

Microsoft will focus its development efforts now on Office 365, the suite's cloud-based edition, first launched a year ago

Microsoft launched the public beta of Office's next version on Monday, saying that from now on the suite's cloud-based edition, Office 365, will be its primary focus of development.

Microsoft will market a new version called Office 2013 that will be installed locally on devices, but the future of the suite lies online with the cloud-based version released in preview mode Monday, said CEO Steve Ballmer during a press conference that was webcast.

"This is the new generation of Office, where it is a service first," Ballmer said, adding that this new version of Office is the first one to be designed primarily as cloud-based software.

The new version of Office has also been designed to work best with Microsoft's new Windows 8 OS, in particular with its Metro interface, which is optimized for touch interfaces such as those in tablets.

"This is the most ambitious release of Office weve ever done, Ballmer said.

In addition to hand gestures, Office has also been optimized for stylus input devices, but works equally well with keyboards and mice, he said.

The first Office applications getting a Windows 8 revamping in the Metro style are OneNote, which is for taking notes, and Lync, which includes IM/presence, Web meetings, video conferencing and audio communications capabilities.

The local version of Office will ship bundled with devices running Windows RT, the Windows 8 version for ARM-based machines, including Microsoft's own Surface tablet. That Office suite will include Word, Excel, PowerPoint and OneNote.

The cloud-based versions of Office will be licensed on a subscription basis, while the versions that will be installed locally on machines will be sold in the traditional perpetual license model.

In a demonstration at the press conference, it became clear that Microsoft has tried to give the Office applications a more modern, clean interface.

Microsoft held off on providing full details on all the different Office bundles and prices, but it did disclose details on three cloud models that each will include Word, Excel, PowerPoint, OneNote, Outlook, Publisher and Access.

The first version, called Office 365 Home Premium, will be aimed at individual consumers and families and include 20GB of storage in the company's Skydrive cloud storage service, as well as 60 minutes of Skype world minutes per month.

The second version, Office 365 Small Business Premium, is, as its name indicates, for small businesses, and includes business-grade email and calendaring and high-definition web conferencing.

Finally, Office 365 ProPlus is for enterprises and comes with additional features designed for IT departments and large companies.

A Microsoft spokeswoman didn't immediately explain how these new Office 365 bundles will fit in, or possibly replace, the existing Office 365 editions available for the past year.

Those interested in giving the new Office suite a test drive can access it at http://www.microsoft.com/office/preview/en.

Juan Carlos Perez covers enterprise communication/collaboration suites, operating systems, browsers and general technology breaking news for The IDG News Service. Follow Juan on Twitter at @JuanCPerezIDG.

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