Microsoft Corp. next year will expand its Office product lineup with a bundle designed to help small businesses operate better, taking on Intuit Inc. and its QuickBooks product.
The new Microsoft Office for small-business management product bundle will include the familiar Office 2003 applications along with a new financial management product called Microsoft Office Small Business Accounting and an updated version of Outlook 2003 with Business Contact Manager, Microsoft said in a statement today.
With the new Office edition, due out at the end of 2005 in the U.S., small businesses will be able to manage customer, financial and business processes, according to Microsoft. Payroll functionality is offered through integration with services from outsourced payroll services provider Automatic Data Processing Inc., Microsoft said.
The new Office edition was developed jointly by Microsoft's Office group and Microsoft Business Solutions, the Microsoft group that sells business applications to small and medium-size businesses and divisions of large enterprises. Office for small-business management will offer an easy migration path to MBS products, Microsoft said.
By offering a path up to the more sophisticated MBS products such as Great Plains and Microsoft CRM, Microsoft is filling a significant gap in its product offerings and taking on Intuit, said Paul DeGroot, an analyst at Directions on Microsoft Inc. in Kirkland, Wash.
"Microsoft has a major gap in its small business offering. They have basically left that to Intuit, and QuickBooks is the dominant product in that area," DeGroot said. "As a consequence there has not been a ladder for small businesses to climb on and get to Great Plains. I would say that this is an important gap that Microsoft needs to fill."
Aside from winning more customers for its business products, the expansion of the Office suite lineup also fits in with Microsoft's strategy to grow its Office business by tailoring product bundles for specific audiences. The vendor already sells a Small Business Edition of Office 2003, introduced last year, which includes Excel, Outlook with Business Contact Manager, PowerPoint, Publisher and Word.
Microsoft pitches the new Office Small Business Accounting product in the bundle as an opportunity for partners. Other software makers, or independent software vendors, can offer vertical and horizontal applications on top of the new Microsoft accounting software, the software maker said.
Microsoft didn't disclose pricing information and said it is too early to discuss plans for international availability of Office for small-business management.
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