Putting office applications on the web will pay off for Microsoft, a top executive at the software maker said at on Thursday.
During an on-stage chat on Wednesday at the Web 2.0 Expo, Stephen Elop, Microsoft's president of the business division, defended himself against conference instigator Tim O'Reilly's challenge that Microsoft's traditional office applications are not making, and may not be able to make, a successful transition to the web.
Elop responded that the lessons of Web 2.0 success, from companies such as Wikipedia, are making their way into enterprise computing and Microsoft products.
"What's happening behind the firewall [in business settings] is identical to what happened on the internet," Elop said. "The difference in the enterprise is that you can translate the value into something customers are willing to pay for. While social networks themselves may be challenged financially, in the enterprise, [Web 2.0] is working."
Elop pointed to SharePoint as the indicator of this success. It is "the fastest-growing product in the history of Microsoft, and it's because the principles of Web 2.0 are being applied to it", he said. Hammering home the message of SharePoint's value, he said: "For every dollar we earn, our customers get tremendous value, and there are seven or eight dollars for developers."
Microsoft is offering some of its apps as over-the-web services, Elop continued. Nike, Coca-Cola and other companies are paying for online access to Microsoft-hosted apps.
In product news, Elop hinted that an iPhone version of Office may be coming. It is 'not yet' near, but 'keep watching', he said. He also said a cloud-based Office suite will come soon, with limited features.
O'Reilly asked if it would be free. Elop replied: "Ad-supported. Nothing is ever free." Features in the paid versions of the suite that would not make it to the free yet ad-supported product include integration with SharePoint and 'unified communications' — features most consumers can probably live without.
As to when it will be available, Elop said: "Beta code in not-too-long a period of time, but not this calendar year."
Other Microsoft products that are in the pipeline include a Twitter competitor. "We are experimenting in a corporate setting," Elop said. He added that it was a big challenge to bring microblogging functionality into the business setting, where younger employees are avid boosters for the concept but older workers (who are sticking around longer due to the recession), "aren't even comfortable with email".
Despite its apparent slow pace at adopting web concepts in its products, Elop said Microsoft continues to invest in new technologies. "The only way through this economy is improving productivity. During tough times, we have to power through. That's why we have $9bn in R&D. We have to continue to innovate."
