Microsoft Starts Taking Office On The Web Seriously

Earlier this week, Microsoft updated its Office 365 suite with a couple of new features and licensing terms. Overall, the update was very much in line with the other 100 changes Microsoft had made to its subscription-based Office version for consumers and businesses, but one feature stood out. Starting this week, all Office Web Apps will feature real-time collaborative editing – a feature previously only available to the Excel and OneNote web apps.

This in itself is an interesting move, but while talking about the update, John Case, Microsoft’s corporate vice president of its Office division, told me that this also signals a new way of thinking about the Web Apps inside of Microsoft.

Let’s take a step back first, though. If you are unfamiliar with the Office Web Apps, just take a look at SkyDrive and upload a Word, Excel or PowerPoint document. Once the file is online, you can view it in SkyDrive, but most importantly, you can also edit it in a light-weight version of Microsoft’s flagship productivity apps.

The Office Web Apps launched three years ago, but have mostly flown under the radar, despite the fact that they are more fully featured than Google’s offerings. Given Microsoft’s control over the file formats, it’s also significantly better at displaying and saving files without mangling any of the formatting. They also use the same Ribbon menu as the regular desktop Office apps, so regular Office users should be productive in them right from the get-go.

Until now, however, these Web Apps were basically companions to the clients, and Microsoft did virtually nothing to promote them. It looks like that’s changing now. As Case told me, Microsoft is now finally starting to view the Office Web Apps as standalone services. Case wouldn’t say whether Microsoft is considering a move to a freemium model and package paid services on top of the free offering. If Microsoft considers the Web Apps as a standalone version of Office, though – and in the (very) long run, they could become the only version, after all – I wouldn’t be surprised if that’s something the company is considering.

Microsoft always focused heavily on the Office desktop clients. That’s where all the money was made, after all. Now that it has moved to a subscription model anyway, adding premium features to the Office Web Apps feels like a logical next step.

Case told me Microsoft plans to invest more into the Office Web Apps in the coming months, so we will likely hear quite a bit more about what the company has in the works for these services.

If Microsoft starts to invest more heavily in this area, it will also provide an even greater challenge for Google, whose online office suite is still unsuitable for anything but very basic editing. One advantage Google always had, however, was that it offered collaborative editing. That advantage is gone now, but Microsoft has to start emphasizing these features. So far, it probably didn’t do this because it didn’t want to cannibalize its regular Office sales (the Web Apps are “good enough” for many use cases, afer all). If that starts changing, Google better watch out.

Image credit: Sunfox