Microsoft puts price, date on new Office

The final details came with the expected announcement that the core Office applications are complete and ready for distribution to PC manufacturers, who need to test the software in preparation for loading it on new computers. The "release to manufacturing" (RTM) stage is typically the last milestone before a major new software release becomes available to the public.

As expected, retail pricing for various Office packages will be identical to the recently reduced prices for their counterparts in Office XP, the current version of the software. It also matches lower prices Microsoft introduced last week for the Mac version of Office. The standard edition of Office 2003 will sell for $399, the professional edition will go for $499 and the increasingly popular student/teacher version will cost $149.

Standalone versions of the main Office 2003 applications--Word, Excel and PowerPoint--will sell for $229. The standalone version of the Outlook e-mail program will cost $109. InfoPath, Microsoft's new electronic forms application for businesses, will sell for $199. OneNote, a new note-taking application, also will sell for $199 but comes with a $100 rebate on that price.

Corporate Office 2003 packages will be added to Microsoft's volume pricing list on Sept. 1, the company said Tuesday.

Paul DeGroot, an analyst at research firm Directions on Microsoft, said he expects volume pricing to mirror the recent price cuts for retail versions of Office. Unless Microsoft can show a clear price advantage, small businesses might opt to go with retail packages that could give them more options and better pricing when the next upgrade cycle comes around, he said. Microsoft's preference is to shepherd customers into licensing programs such as the controversial "Software Assurance" plan that locks customers into periodic upgrades.

"I think that, especially for small companies, Microsoft needs to demonstrate they're really going to get a discount and save money by going with volume licensing," DeGroot said. "It's very important for Microsoft to retain volume licensing customers...so they can get them into Software Assurance and other annuity programs."

The packages will go on sale to retail customers Oct. 21, Microsoft said. However, PC makers are expected to begin shipping models loaded with Office 2003 by the end of September. Microsoft had promised a "late summer" release of the products.

The British Web site of online retailer Amazon.com accidentally gave a preview of Office 2003 prices and availability, when product pages for the various packages began appearing on the site last week.

Microsoft is positioning the new Office as a major transition for the company, thanks to its broad support for XML (extensible markup language) as a way to tie Office applications to back-end business systems and Web services. The Office 2003 family also includes several new applications, most notably InfoPath, Microsoft's attempt to stake a claim on the nascent market for applications that create interactive forms for corporate databases.

Microsoft said the Oct. 21 retail release would be accompanied by a worldwide launch event in New York. DeGroot said the company already made its biggest move to entice consumers last year with the release of the student/teacher version of Office, which dramatically lowered the price for people who want to use the software at home.

"I think student/teacher is going to be the big product on retail shelves," he said. "That's the most attractive deal, a great many home users qualify for it, and nobody asks any questions if you don't qualify."