Ballmer: No Microsoft Office 14 Until 2010

Microsoft Office

Microsoft had not set a release date for the next version of the Office suite, but many within the industry had anticipated that it could be out sometime this year.

Ballmer's comments came as he was discussing the impact of slower PC sales on Microsoft and outlining Microsoft's plans to compete against the open-source OpenOffice software suite. "From a strategy perspective, the next big innovation is Office 14, our next Office release, which will not be this year," Ballmer said, according to a transcript of his presentation posted on Microsoft's Web site. Ballmer did not elaborate on the reason for the Office 14 release schedule.

It's questionable just how much demand there would be for Office 14 this year. The current version of the software, Microsoft Office 2007, debuted just over two years ago and adoption of that release has been relatively slow. Customers that recently finished installing Office 2007 would be unlikely to upgrade very quickly.

In addition to Open Office, Microsoft has found itself competing against personal productivity applications offered by Google, Zoho and others. Microsoft is also developing a Web version of the Office applications to compete more directly with those products.

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Ballmer and CFO Chris Liddell presented analysts with a relatively gloomy picture for Microsoft's business for 2009. Liddell noted that while Microsoft's revenue in the first half of its fiscal year (July through December 2008) was up 5 percent to $31.7 billion, that was less than the company had expected going into the year.

"We expect conditions to remain difficult through at least ... the second half of our fiscal year, the first half of the calendar year," Liddell said. The CFO expected Microsoft's desktop software business to be particularly hard hit given the slowdown in PC sales to both consumers and businesses. He said increased sales of products for netbooks would somewhat offset slower PC-related software sales.

Microsoft's server and tools business would likewise be impacted by slowing sales of hardware servers, Liddell said. But about two-thirds of that division's revenue comes from "annuity" sales generated by ongoing service and license payments. Pressure on advertising spending will likely continue to impact Microsoft's online business through the remainder of the fiscal year ending in June.

"We've got a view that the economy is going to be relatively weak for a relatively long period of time," Ballmer said. "On average, I probably think things will be weaker longer than most people [believe]."

Ballmer, nevertheless, said he had no immediate plans to make further cuts in employment and other operating expenses, but he vowed "to manage the costs intensely."