Microsoft Launches Office 97

With a send-off that was positively humble by Microsoft standards, the world’s biggest software company rolled out a new package of its popular business applications.

Retail sales of Office 97 began Thursday, but unlike the launch of Windows 95 in August 1995, there were no long lines of customers clamoring to get a copy or midnight sales around the globe. Only four or five copies had sold by midday at a CompUSA store in midtown Manhattan.

Perhaps that reflected a more subdued marketing campaign than Windows 95 received - no licensing of Rolling Stones songs, and no lighting the Empire State Building in Microsoft colors to mark the event.

Office 97 combines updated programs for word processing, spreadsheets, graphics and databases with some new features, including easier links to the Internet and tools for creating a Web document.

Microsoft Chairman Bill Gates, speaking to about 1,000 reporters, analysts and favored customers at New York’s Lincoln Center, called Office 97 the “centerpiece of Microsoft’s Internet strategy.”

“Over a year ago, we talked about embracing and extending the Internet,” Gates said. “This year, the theme is to go beyond embracing the Internet to take the leadership through innovation.”

Microsoft said it has shipped 500,000 copies of Office 97 to retailers and presold 3 million to corporate customers. The product retails for about $300, depending on how many applications are included.

Analysts said Office 97 is as crucial to Microsoft’s bottom line as any other product. In less than 10 years, Microsoft has grabbed about 85 percent of the market for so-called office suite programs, a level that approaches its dominance in operating software.

“It’s a very critical product for Microsoft to sustain their growth,” said Goldman Sachs analyst Richard Sherlund, who estimates office programs contribute $3.5 billion of Microsoft’s $10.1 billion in annual revenues.

Sherlund said Office 97 may see its sales increase more gradually than typical software upgrades. For one thing, he said Office 97 must be used on either the Windows 95 or Windows NT operating systems, which many companies have not yet moved to.