Microsoft Office floats into the cloud

Microsoft’s unveiled the customer preview of the new Microsoft Office, which it’s redesigned to make the most of touch screens, social networking and the cloud.

The company says it’s the biggest and most ambitious redesign it’s ever done, with the product rewritten from the ground up. Office is one of Microsoft’s most reliable cash cows, accounting for around 60 percent of profits.

There’ll be a local version called Office 2013 available on a standard license, alongside the cloud-based Office 365 sold on a subscription basis, and described as a ‘service first’.

“We are taking bold steps at Microsoft,” said CEO Steve Ballmer at a press conference in San Francisco. “The new, modern Office will deliver unparalleled productivity and flexibility for both consumers and business customers. It is a cloud service and will fully light up when paired with Windows 8.”

Office can now deal with touch and stylus control, bringing Office squarely into the tablet arena – although there’s no word on an iPad edition. The company’s also integrated features such as Bing into the new build, and there’s integration with social networking service Yammer and – at last – Skype too.

But the big push is into the cloud. Office now saves documents to SkyDrive by default, making them available offline and syncing when the user reconnects.

The release is receiving cautiously positive reviews.

“Office is a $20 billion business, and Office 2013 is the best version of Office yet. It will sell millions of licenses to consumers and enterprises (Office 2010 has sold more than 100 million copies, and that doesn’t include the millions of users who use pirated versions of Office),” says Forrester analyst Sarah Rotman Epps.

“But products at the peak of their success can still be vulnerable to disruption, and Office 2013 certainly is, especially to competitors who put mobile first, and who deliver less-good experiences for cheap or free.”

Office 2013, along with the cloud’based Office 365, are due out this fall, around the same time as Windows 8.

There’s no word yet on pricing, although the company says there will be three new Office 365 subscription services including the new 2013 editions of the Office applications — Word, Excel, PowerPoint, OneNote, Outlook, Publisher and Access. The preview’s available here.