Wednesday's update will be the first major change to Office XP since Microsoft fully implemented a new licensing programme for buying the product in volume. Companies looking to continue buying Office at a discount had until 31 July to sign up for the new programme, called Licensing 6. Businesses had to sign up for an older annuity program that expired on that day or enroll in the new one "Software Assurance" annuity programme to continue getting discounts. Previously, large customers could buy software licences at will. Under the new programme, customers must pay 29 percent of the full cost annually for two or three years. Volume licensees also had to move to the current version of Office -- which as of 1 August is XP -- to be eligible for discounted upgrades. Otherwise, they could be compelled to pay full price when they next decided to upgrade. Analysts estimate that as many as two-thirds of Microsoft customers skipped the new licensing programme, citing higher costs. The new programme would cost most businesses 33 percent to 107 percent than the old one, according to Gartner Group. Microsoft estimates that out of about 150 million legally licensed copies of Office, about 80 million are Office XP. The current product's successor, code-named Office 11, is expected to be released by mid 2003, which would deliver Licensing 6 participants their first major upgrade as part of their annuity agreements. "Microsoft understands that customers won't stand for paying for something up front and getting nothing in return. Delivering the next version on time will be very important," said Yankee Group analyst Laura DiDio. Microsoft has many changes on tap for Office 11, which tentatively include making Extensible Markup Language (XML) -- an emerging industry standard for data description and exchange and a central technology for delivering .Net Web services -- the default file format. The new XML capability of Office is intended to make it easier to link desktop programs, such as spreadsheets and word-processing documents, into corporate data stored in customer relationship management (CRM) and other business systems. XML also would make possible ancillary subscription services -- such as online calendaring and Web-based email -- planned for Office 11 and offer better document access on Pocket PC handhelds and cell phones.
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