Office 2003 bundling & licensing plans revealed

This week, Microsoft revealed that the company will expand its Microsoft Office 2003 lineup to include new basic and professional enterprise editions and a developer-oriented release called Visual Studio Tools for Office. But not all Office products will be available at retail locations, and the most compelling version for consumers, Office 2003 Basic Edition, will ship only with new PCs. According to my sources, Microsoft will launch Office 2003 in early June at Microsoft TechEd 2003, and the product will ship later that month.

"By offering different versions of Microsoft Office 2003 for different types of customers with different needs, we will be able to offer customers the latest productivity tools that fit their needs and the way they want to purchase their software," a Microsoft spokesperson said.

Here's how the various editions pan out. The new Office 2003 Basic Edition will be bundled only with new PCs and will include Microsoft Word, Excel, and Outlook. Office 2003 Standard Edition, which will be available in retail stores, will include the same applications, plus Microsoft PowerPoint. Office 2003 Professional Edition will be another retail release and will include everything from the Standard edition, plus Microsoft Access, Publisher, and Business Contact Manager for Outlook. The new Office 2003 Professional Enterprise Edition will be available only through volume licensing--the primary way that large enterprises purchase the suite--and will include all the applications from the professional edition, plus Microsoft InfoPath. Office 2003 Small Business Edition will include all the applications from the standard edition, plus Publisher and Business Contact Manager for Outlook. The company will also continue selling--at retail only--a low-cost Office Students and Teachers Edition, which includes the same applications as the standard edition. And Microsoft will replace the current Office Developer Edition with a product called Visual Studio Tools for Office, although how this product will be licensed and distributed is unclear.

Confused? Hold on, it gets worse. In addition to the myriad choices in suite editions, those editions include different versions of the various Office applications. Office 2003 Professional Edition and Office 2003 Professional Enterprise Edition will include new professional versions of Word, Excel, Outlook, and PowerPoint that differ slightly from the versions in the other suites. The professional versions of these applications include Information Rights Management (IRM) document-protection technology, advanced XML features, and other corporation-oriented capabilities. So only the professional versions can create IRM-protected documents, although any Office 2003 application can work with protected documents.

But wait, there's more. Microsoft is easing up licensing requirements for various versions of the suite. You'll be able to install and use the low-cost Office 2003 Students and Teachers Edition concurrently on as many as three computers, up from one in the previous version; other Office editions still support two installations, one on a desktop, and one on a notebook, though the do not permit concurrent use. And the Students and Teachers Edition will come with less restrictive licensing that will let parents of students or children under age 18 legally buy the product. This change makes the students and teachers edition available to more than half of US households, the company says, and Microsoft expects this version to be its retail sales leader going forward.

One product that's conspicuously missing from these bundles is Microsoft OneNote, an Office System product that the company first revealed last fall. OneNote won't be available as part of any of the suites but will instead be sold separately as a standalone application. Microsoft FrontPage, and Project and Visio, two Office products that will ship later in the year than the rest of the Office System applications mentioned here, will be sold only as standalone products.

Most consumers, however, acquire Office bundled with new PCs, so Microsoft could possibly offer the basic edition to PC makers at a low cost to make it more attractive to those companies that have begun using low-cost alternatives such as Corel's WordPerfect Office or Microsoft Works.