Is the new Office more important to Microsoft than Windows 8?

With the latest Office on deck, Microsoft aims to create its own business tech halo effect even if the enterprise uptake for Windows 8 is slow.

Microsoft is expected to take the wraps off of its latest Office today and the product launch may be more strategically critical than Windows 8. Of course, you'd never know the role of Office 15 judging by the headlines. The numbers, however, tell a different tale.

As Mary Jo Foley noted, Office, which is likely to be known as Office 2013, has a few question marks. It's unclear how folks will get it. Functionality is an unknown -- at least for those of us without a copy of the beta -- and integration with Windows 8 will be interesting.

However, Office 2013 is critical for Microsoft. In the consumer world, Windows 8 is the glue that's supposed to give Microsoft a PC/tablet/smartphone play. In business technology, Office is the product that has its own halo effect. Office 2013 will integrate well with Exchange, SharePoint, and Lync. The new Office will also tie into Microsoft's Office 365 cloud suite.

In other words, Windows 8 can have a slow ramp, but Office 2013 can drive other services. Remember that Microsoft's Windows juggernaut is the best known cash cow, but the business division---Office mostly---and servers and tools are just as profitable and feature as much revenue if not more.

A successful Office 2013 launch can do the following for Microsoft:

  • Offset a potentially slow corporate uptake of Windows 8;
  • Drive synergies with Microsoft's cloud Office efforts;
  • Connect into Lync, SharePoint and other corporate juggernauts;
  • And give people a reason to buy a Windows tablet.

Ahead of Microsoft's fiscal fourth quarter earnings Thursday, analysts are expecting strong enterprise sales and weak PC and Windows results. Morgan Stanley analyst Adam Holt is expecting Windows revenue in the fourth quarter to fall 14 percent from a year ago.

Here's a look at Microsoft's third quarter for its business division.

The bottom line here is that Microsoft has a killer product cycle ahead and by the numbers the financial success of Windows 8 could be overshadowed by Windows Server 2012, a new SQL, Dynamics and naturally Office 2013.

This story was first published as "Microsoft's new Office: More strategic than Windows 8?" on ZDNet's Between the Lines.

Watch our First Look of the new Microsoft Office:

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