Code-named Office 10, the update includes new speech-recognition technology, additional support for Extensible Markup Language (XML), a Web-based collaboration application to let workers share documents and other data, and content-management tools.
Microsoft Office dominates the desktop application market, which includes Lotus Development's Smart Suite and Corel's WordPerfect. Sun Microsystems also offers StarOffice, a Linux-based productivity suite that can be downloaded for free.
Office 10 includes speech-recognition technology that allows people to correct and edit Word documents while dictating to the computer, Office product manager Lisa Gurry said. "Users can also give oral commands while typing a document."
Gurry said the speech-recognition technology marks the first time the company has included such a feature in its products.
Office 10 furthers the application's support for XML--a system for marking up documents with industry- or task-specific tags--within the business applications Excel and Access.
In what the company has dubbed a "team workplace" application, people will be able to add and edit content, such as announcements and documents, on a common Web page using a Web browser without needing to know HTML, Gurry said.
The workplace feature meets the needs expressed by many Office users who "asked for Office to do more things with the Web," Gurry said.
The newest version of Office also includes Smart Tags, which pop up on screen while people access or enter data. The tags will give people choices to automatically correct, number or format the data they are working on.
Smart Tags also can help users access information from the Web or other Office applications. For example, if someone types a contact's name in Word, a Smart Tag will appear and provide the option to automatically insert the contact's address from Outlook. A stock quote typed into Excel would present an option to access information about the stock from the Web.
"The goal is to give people options while they work and give them more control of their content," Gurry said.
Ease of use is key to the application, one analyst said. "With this release, there is a big focus on exposing those Office features that have been hard to access by users in the past," said Rob Enderle, an analyst with Giga Information Group. "It's all about usability."
Another tool in the latest version is the Task Pane. Task Pane views expose a range of features to help people easily identify and use more of the product. They offer functions such as finding and creating documents, copying and pasting, using styles and formatting, and searching and translating.
In addition, Excel, PowerPoint and Outlook will join Word in offering AutoRecover, which automatically saves documents at timed intervals so users can easily save and back up their work.
Users of the Office messaging application, Outlook, will be able to receive Hotmail messages within their Outlook client.
The desktop version of Office has long been a cash cow for Microsoft, so it is no surprise that the company would continue to update its existing product line.
And like other major technology companies, Microsoft has made an aggressive effort to tackle the lucrative application-hosting market, forging links with application service providers (ASPs) that will host, install, manage and support Microsoft products such as the Windows 2000 operating system and the Office productivity software.
Along with building Office 10, Microsoft is simultaneously developing an entirely new version of Office as part of its .Net strategy. Office.Net, expected to debut in 2002, will feature a "natural user interface," such as handwriting and speech recognition, and will be completely Web-based, the company said.