Office and Windows Mobile's cloudy Microsoft Azure future

Microsoft's big news of the week has to do with the unveiling of Office 2010 and SharePoint 2010 on NBC Studios' New York City set of "Saturday Night Live." ( Why the company decided to host the midday event there is a question that only Redmond can answer; the debut of Windows 7 took place in a Soho warehouse, which didn't make a terrible amount of thematic sense, either. ) For business customers, the software is on sale starting now; consumers will have to wait another month to get their hands on it.

Microsoft currently occupies some 94 percent of the productivity software market, based on Gartner's numbers from 2009, which is a sizable lead by any measure. Nonetheless, the May 12 presentation by Microsoft Business Division President Stephen Elop spoke to several of the company's possible insecurities over the position of Office in a rapidly changing world.

Based on Elop's talk to a crowd of media representatives, analysts and customers, it seems as if Microsoft's biggest fear is that customers will choose to stick with older versions of their productivity software in lieu of upgrading. Elop kept highlighting Office 2010's supposed ability to "reduce costs" and impel "significant gains in productivity," which is meant to appeal to businesses the IT budgets of which underwent a severe whacking in the recent economic unpleasantness.

Google Apps holds a relatively small share of the productivity software market compared with Office, but it seems as if more people are giving cloud-based applications a serious look. Microsoft's short-term attempt at curbing that threat involves offering stripped-down version of OneNote, Excel, Word and PowerPoint to Windows Live subscribers for free via their browsers.

The mobile aspect of Office definitely seems to fit within the larger "three screens and a cloud" strategy advocated by Microsoft. Whether or not the Office hub (or similar Office functionality being offered through Nokia phones) proves robust enough for people to conduct work through it while on the move, it represents Microsoft's attempt to stay ahead of the general evolution from the desktop to the cloud. Whether it can succeed is a multibillion-dollar question.

Office now includes a Microsoft Azure cloud component, and will be available as a hub on the upcoming Windows Phone 7

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