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Microsoft delays Office 2007 release, announces sales layoffs

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Microsoft delays Office 2007 release, announces sales layoffs
UPDATE 30 June 2006 2:15 pm ET

Redmond (WA) – It’s getting to be a pattern at Microsoft that bad news, such as delays and retirements, are announced at the end of the week. Tuesday is patch day; Friday is delay day. The latest delay may have the most impact on those who, just a few weeks ago at TechEd in Boston, were demonstrating a product that they described as mostly done: Office 2007 is being delayed, a Reuters reporter was told overnight, this time from October to at least the end of the year, with the upgrade edition for consumers coming in “early 2007.”

A closer look at Office 2007 – TechEd 2006 slide show …

Judging from the content of MSDN developer blogs this morning, indications are that this is just as much news to them as it is to us today, with “October” still the month that rolls off their fingertips. Just a few weeks ago, at TechEd 2007 in Boston, developers and managers close to the Office 2007 project were touting the strength and quality of tester response to the product as being responsible for its relative state of completeness, promising the product was close to done “thanks to you.” Now, in a statement this morning, the company is stopping just short of blaming the quantity of tester response for the delay:

“Based on internal testing and beta 2 feedback around product performance,” the statement reads, “we are revising our development schedule to deliver the 2007 Microsoft Office system by the end of year 2006, with broad general availability in early 2007…Feedback on quality and performance will ultimately determine the exact [launch] dates.”

Observers familiar with Microsoft’s general patterns may point out the intentional vagueness of this projection, and note that the “track” for release is more vague now than it was just last week. Just as today, being the day before the second half of the year, could be considered “early 2006,” the possibility exists that we may not see Office 2007 for at least a year. However, Reuters was told to expect a release for business customers – those who purchase licenses in volume – by the end of this year. The question then becomes, if the code is good enough for the enterprise, why isn’t it good enough for the consumer?

UPDATE: This afternoon, a Microsoft spokesperson addressed that issue to TG Daily, saying, “Based on the beta 2 feedback and internal testing, we have a deeper view into performance issues that we recognize will require additional development time.

In early June, Jensen Harris – who works on the UI team for Office 2007 – reported there were only four classes of minor changes left for his team to make between the public Beta 2 release and the final RTM. “We continue to work on getting the details right for all aspects of the product, making sure it’s ready for the showroom floor,” Harris wrote. “And there are a few flourishes still to come,” including revised product icons, he added. But nothing which indicated a delay until the final day of “early 2007.”

This morning’s delay prompted Citigroup analyst Brent Thill to speculate that Windows Vista – whose timing tends to go hand-in-hand with Office – may also be delayed until “early 2007.” Two weeks ago, it was Thill who stated in a report that the pending departure of Bill Gates from day-to-day operations may be a sign of a significant morale decline at the company, which was one factor which prompted Thill to reiterate his “hold” rating for the company.

Adding a peculiarly ominous tone to this day is news which Microsoft promises isn’t related to the Office delay, stating it has already laid off 214 members of its US sales force. The company intends to continue its plans to hire 66 new members of that same force (presumably not at the same salary level).