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Microsoft, Open Source Claim XML Success

Microsoft's recent announcement that it would offer royalty-free licensing for its Extensible Markup Language schemas in Office 2003 has both the software giant and open-source advocates claiming victory for the open standards movement.

But analysts and industry experts say the real winners are the independent software vendors (ISVs), whose hearts and minds are up for grabs in the Web services movement to expand the use of XML and open standards.

The royalty-free licensing program, which Microsoft announced on Nov. 17th, is related to Microsoft's new Office 2003 versions of Word, Excel and its InfoPath back-end, information-gathering programs. The suite uses schemas , or metadata, that describe how information is stored when documents are saved as XML files.

The Microsoft Office 2003 XML Reference Schemas included in the royalty-free license include WordprocessingML (Microsoft Office Word 2003), SpreadsheetML (Microsoft Office Excel 2003) and FormTemplate XML schemas (Microsoft Office InfoPath 2003).

Danish government officials said that after asking Microsoft to provide it with technology to help its eGovernment initiative improve the exchange of millions of documents, the software company responded with the licensing plan.

Helge Sander, minister for Science, Technology and Innovation for the Danish government, called it "a clear step in the right direction by making its XML technology openly available. This enables our eGovernment solutions to utilize standards-based technology while further enabling open and effective tools for our citizens and government."

Alan Yates, a senior director of business strategy for the Office 2003 team, said the licensing plan enables customers' own schemas in Word documents, Excel spreadsheets and with InfoPath.

"One of the things we learned during a nine or ten month beta is that governments in particular have a requirement of interoperability" and not just on the data they preserve, but in the look and feel of a document if a citizen is using another piece of software with Office 2003, he said.

Yates said what Microsoft has tried to do, in a very straightforward way, is put together an easy-to-support royalty free XML schema in order to help accelerate document exchange and interoperability -- and in a way that sometimes becomes too difficult with far-flung standards organizations.

But Gary Edwards of OpenOffice.org, the open source group that distributes a free office productivity suite, called the plan the first defensive move that Microsoft has made to safeguard its dominant position in the operating system and office suite markets.

"Mind you, these are their only two profitable business segments," said Edwards, who also is a member of e-business standards group OASIS's Open Office File Format Technical Committee.

Edwards said one needs to recognize that what appears to be an open gesture by Microsoft comes at a time when the European Commission is meeting to resolve antitrust issues with the software company.

The commission recently wrapped up three days of hearings about whether Microsoft abused its dominant market position with Windows to stifle competition there.

The EU has charged that Microsoft used bundling tactics with Windows to dominate the market for server software. A settlement is expected after the new year.

Microsoft has said that as information exchange and integration have increased in critical importance, customers, partners, governments and the IT industry have asked it to deliver solutions that improve data interoperability and exchange. The royalty free licensing plan is just one of those responses.

Edwards said any rejoicing about Microsoft's "new openness is clearly overdone. Microsoft XML is not the native, default file format of MS Office 2003; and furthermore, saving files in their particular implementation of the XML format is only available to the most premium customers who purchase licenses to a whole rash of Microsoft application and server products."

Microsoft knows that it's "under siege from the open source movement, especially in countries such as Germany and in the UK," said The Yankee Group's Senior Analyst Laura DiDio. "They still have an antitrust suit to contend with. So the company is moving to respond quickly and say, 'look, we'll be as open as we have to be to win your business,'" especially with the ISVs.

Microsoft's success with its Windows operating system has been built on the depth and breadth of the ISV market that develops products for Windows, DiDio added.

"If you look at operating systems of other vendors, such as Novell's NetWare and even Apple, they lost market share with their operating systems when their ISV market dried up."

Microsoft has said that one of its core building blocks of its .NET strategy is extending the use of XML. To that end, the release of Office 2003 is seen by DiDio and other analysts as a more collaborative environment, which is expected to appeal to the ISV market.

"People need a reason to move to the next generation product or application. They want to know that it's interoperable," DiDio said. In addition, "Microsoft is going to fight tooth and nail to retain its market and not get into a situation where it's suffering mass defections to open source. If you're going to spur development with your platform, then you have to make it easy for custom in-house developers."

Before it launched Office 2003, Microsoft heavily touted the openness of the productivity suite, which offers broad XML support, noted Joe Wilcox, Microsoft Analyst for Jupiter Research. (Jupitermedia owns Jupiter and this publication.)

"Overall, the schema licensing is a promising change for Microsoft customers using Office 2003. What I don't understand: Is why Microsoft didn't just take the more open, interoperable approach in the first place," he said in a note on his Microsoft Monitor Weblog.

The Microsoft Office 2003 XML Reference Schemas documentation and license can be obtained starting on Dec. 5th through the Microsoft Software Developer Network Web site.

Implementation of the documentation and license can be viewed in the Danish InfoStructureBase.