The new Office 2007 is the successor to the company’s Office business application franchise, which packages together word processing, spreadsheet, presentation and other programs.

The upgrade to Office and a separate upgrade to the Windows operating system planned for later this year are crucial for Microsoft since those two businesses account for more than half of the company's total revenue.

In the second half of 2006 Microsoft is scheduled to launch an upgraded version of Office with redesigned user interface which aims to simplify the task of finding features already available within its family of programs, such as Word, Excel, PowerPoint, Access and Outlook.

Microsoft last launched an Office upgrade in September 2003.

"We really think this is the most significant advance in Office in a decade," said Parri Munsell, Microsoft's group program manager of Information Worker licensing and pricing, according to Reuters.

The changes reflect Microsoft's aim to make Office more of a collaboration suite that connects employees throughout the organization than a set of productivity applications that each employee uses, Munsell said.

The 2007 Microsoft Office System will include seven Office suites, including one new enterprise package--Office Enterprise 2007--and two rebranded packages. Microsoft Office Professional Plus 2007 will correspond to Office Professional Enterprise Edition 2003, while Office Home and Student 2007 is an update of Office Student Teacher 2003, Munsell said, cited by Elizabeth Montalbano for the IDG News Service.

Suites rounding out Office 2007 System are Office Professional 2007, Office Small Business 2007, Office Standard 2007, and Office Basic 2007.

Professional Plus is the suite that most corporate customers will use, Munsell said. In addition to offering the applications already available in Office--such as Excel, Word, PowerPoint, Access and Outlook--this suite for the first time will include Office Communicator, Microsoft's corporate instant-messaging application, he said.

The new Enterprise 2007 offers everything that is included in Professional Plus, as well as Office Groove 2007 peer-to-peer collaboration technology and Office OneNote 2007 software for simultaneously typing notes and recording speech.

Both Professional Plus and Enterprise 2007 are available only through Microsoft's volume licensing program; the company does not provide specific pricing for this because it varies by customer, Munsell said.

To help companies purchase some of the new licenses that will be required to use Office 2007's collaboration capabilities, Microsoft will offer a new Enterprise Client Access License (CAL). The new CAL includes all the licenses under its current Core CAL together with licenses for products such as Live Communications Server and Windows Rights Management Services, he said. Microsoft's Core CAL currently includes licenses for Windows, Exchange, and Office.

Microsoft also announced a range of Office 2007-related server products, including an updated SharePoint Server, a projects server and a server to create forms hosted on the Internet that the company says will make it easier for users to collaborate and share documents and data.

In addition, the company will offer Office Forms Server 2007 to enable Office users to publish forms to a server as an alternative to purchasing SharePoint Server and all of its portal and content-management technology, he said. Users of the volume versions of Office can take electronic forms and Excel spreadsheets and publish them to Forms Server or to SharePoint Portal Server without having an additional InfoPath Server locally installed, as was previously required.

It will be quite an interesting suite, and corroborated with the launch of the Vista OS, it could really represent a new era for Microsoft. That is, if the Vista-Office package proves to be a hit.