Given that web2.0 and open source in the office is perhaps the largest item in my recent article here I’m going to break this into a couple of parts. This first part will concentrate on Microsoft Office and why it is still the dominant player today. The second part (which will come quite soon) will argue that web2.0 combined with open source will be a much more dangerous competitor to Office that Microsoft has ever seen before.

So having said that lets take a look at the 800 pound gorilla of the small business IT infrastructure: Microsoft Office. Office has long been the cash cow of Microsoft as outlook,word, powerpoint and excel have become the de facto industry standards in the IT world. For several hundred dollars per user Office delivers an integrated set of applications that are essential to any business of any size. Users of all skill types can create and send essential documents to other users and businesses.

For this relatively seamless experience however businesses face a number of problems:

1. They have to pay a large up front fees to Microsoft.
2. Microsoft release ever more confusing licencing arrangements to prevent piracy and protect revenue.
3. Businesses are locked into the Microsoft upgrade path, every few years Microsoft release a ‘new’ version, sometimes this new version doesn’t work with the old version and then if it does it may not work with the Microsoft operating system

Open Office has long been the white knight to those who suggest businesses remove themselves from the Microsoft monopoly. I often feel a sense of frustration from the open source community as to why Open Office hasn’t dislodged Office. After all it has pretty much all the features of Office (including adding functions like exporting to PDF) and Open Office is good at reading/opening Microsoft documents.

The trouble with Open Office is that while it does around a 97% job of reproducing Office even with Open Office 2 you still do get the feeling that the software (even though the difference is very small) doesn’t quite match up to Office. How many businesses would really go through the difficulty of migrating away from a product that they have already paid for, only to replace it with something that users would likely complain about for some time.

Open Office is a great piece of software I’ve been using it as my primary office application for some years but in my experience of IT, business rarely look to replace one piece of technology/hardware/software with another unless it offers something more than the incumbent, even if it could substantially reduce cost.

Enter web2.0, the world of collaboration and companies such as Google, Zoho, Zimbra who are knocking at the door to Microsoft’s dominant strong hold.