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IBM challenges Microsoft's Office

Mike Ricciuti CNET News.com

Published: 10 May 2004 08:40 BST

IBM on Monday is expected to announce new software intended to take on Microsoft in the market for desktop business applications.

The new software, an addition to IBM's Workplace strategy, is a bundle that includes email, word processing, spreadsheet and database products aimed at business users. While Microsoft's market-leading Office bundle works only on Windows and Apple Computer's Macintosh operating systems, IBM's new software is designed to be accessed through a Web server, meaning its accessible from systems running Windows and Macintosh, as well Linux, Unix and handheld devices, sources close to IBM said.

Steve Mills, the top executive at IBM's software unit, is expected to announce the new software at a press conference in New York.

IBM has also rounded up support from other software makers, including Siebel Systems and PeopleSoft, which can make their Web-based business applications available through the new IBM software.

IBM hopes to sway customers with two key selling points: mobility and price. Unlike pure Web applications, the new software is designed to be used offline, so mobile users on laptops or handheld devices can connect, quickly access applications and disconnect to do work offline. When they connect, the software synchronises their work with server-based applications.

The company plans to charge customers $2 (£1.13) per user per month for access to the software, plus the cost of server software, such as IBM's WebSphere, needed to make the system work. IBM intends to make the bulk of its revenue from the new plan on sales of the server software.

Microsoft controls more than 90 percent of the desktop software market. In the past year, Sun Microsystems has made inroads with some business and government customers with its StarOffice and OpenOffice desktop software. Neither Microsoft nor Sun was immediately available to comment on the announcement.

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