Can Office Finally Make The Leap To App Dev Platform Status?

Office System 2003 Office System Developer Conference

That brings up the perennial question: Can small ISVs profit in a world where the platform continues to leap up the application stack?

Microsoft insists that regardless of how many functions it crams into its core applications, there will always be "white space" in which ISVs can add their own value. The vendor has spent millions extending Office beyond Word, Excel and PowerPoint to tools and servers. While this isn't the first time it has tried to make Office a platform, partners say it may be the first time it succeeds.

Rich Glew, director of marketing for Information Worker Partners at Microsoft, said what's different now is that the 15-month-old Office 2003 "isn't your father's Office."

He ticks off the lineup: "We've got the Office System Development Kit, ASP.Net support, SharePoint technologies and native Web Parts support. We've got our own XML schema, and support for XML with InfoPath, and the entire Visual Studio Tools for Office, as well as new back-end integration with the Information Bridge Framework." Phew.

The beauty of Word or Excel front ends is that customers can keep using a familiar interface even as more back-end functions and data are exposed to it. The flip side, as critics point out, is that the Word/Excel/PowerPoint combination remains the world's fattest, most resource-intensive client.

Skeptics have long maintained that Microsoft, in its quest for continued growth, will not leave breathing room for third-party innovation. ISV proponents counter that it's not cost-effective for even giant Microsoft to own every vertical.

"I hope it's not arrogance or delusion on our part, but we are not concerned about Microsoft stepping into [our space]. It's not clear where they'd find the knowledge," said Stan Duffendack, CEO of Orlando Software Group (OSG), a specialist in Six Sigma "lean manufacturing" solutions built atop Visio and Excel.

OSG, Lake Mary, Fla., is evolving from a services company into an ISV. The company said its revenue now is split evenly between software and services, and it hopes to garner 75 percent of revenue from software by year's end.

Unique World, Sydney, Australia, is another case in point. The consultancy, which specializes in new media and enterprise applications, spun off an ISV business 18 months ago, said CEO Eddie Geller. As an ISV, Unique World Software offers InfoView, a Web forms package based on InfoPath.

Redmond-based Sourcecode-K2 Workflow's software links tightly into SharePoint, Exchange, BizTalk and InfoPath. While Microsoft has talked about building more workflow functionality into its core products, Sourcecode CEO Adriaan Van Wyk remains philosophical: "Our features will always add value."

On the other hand, all ISVs must stay at the top of their games. The fact that Microsoft goes up the stack is "not a fear, it's reality," Van Wyk said.

"[That can] create end-of-life situations for some ISVs who ignore that fact and are not paying attention. But that same fact creates new opportunities, as well. As Microsoft moves up the stack in workflow plumbing, it will create more awareness and a bigger platform for us to build on," he said.