Yahoo may rent office tools

Summary:Yahoo is conducting a survey to determine demand for a service that allows you to access and edit files from anywhere at any time. Plus, it would be a much-needed revenue boost.

Yahoo is testing demand for a new paid service that would feature Web-based word processing and other office applications, a move that could boost much-needed subscription revenue in the face of an anemic online ad market.

The giant online portal is hosting a survey on its Web site that asks questions based on a hypothetical "full-featured suite of office productivity tools available online through a browser, handheld devices and Web-enabled cell phones."

"Combined with online file storage, this application allows you to access and edit all your files from anywhere at any time. You would also be able to grant access to your document to others," the survey page reads.

A Yahoo spokeswoman acknowledged the use of the survey but referred additional questions to another Yahoo representative who did not return phone calls late Thursday. Rules for a $1,000 sweepstakes linked to the survey indicate that the contest began Sept. 1 and will end Sunday.

The survey provides some hints on what the company is considering, but no information on when, or if, it will be launched.

It focuses on determining how much a person would be willing to pay to access office tools over the Web. Collecting subscription fees for these tools would fall in line with a widely held goal by the company and its chief executive, Terry Semel, who was hired earlier this year to help bolster and diversify the company's revenue sources.

Survey questions include how much consumers would be willing to pay for Web-based office applications and whether they would prefer to pay monthly or yearly.

The survey also asks how much customer support consumers would expect for such services and whether they would pay extra for that support.

Yahoo has been hammered by the dot-com wipeout, which has sharply cut its revenues and earnings. In January, the company trimmed revenue expectations from $1.42 billion to between $700 million and $775 million. Its stock price has plummeted from a 52-week high of about $106 to less than $10 a share.

Yahoo's efforts to augment advertising with other revenue sources have shown few results so far. In its second-quarter earnings call, the company said it expects advertising to account for 80 percent of its revenue this year, down slightly from about 85 percent in 2000.

The addition of Web-based office tools would extend Yahoo's foray into small-business and office products. The company already sells Web-hosting services and domain name registration for small businesses. The company also sells business e-mail accounts, which include multiple, private e-mail addresses, additional storage space, virus scanning technology and spam-free e-mail.

Yahoo also has been courting large corporations with a business-portal service.

Applications on the Web
The size of the market for Web-based office applications is unclear. Microsoft's Office dominates the PC market, facing only weak competition from rivals such as Sun Microsystems' StarOffice and Corel's WordPerfect.

In addition, several other smaller businesses such as ThinkFree, WebOS and VistaSource also offer Web-based business applications. The primary benefit of such Web-based services is that documents can be accessed from any Internet-connected PC.

Microsoft, which controls more than 90 percent of the market for word processing, spreadsheet and other desktop application software, already offers its Office XP software on a subscription basis in Australia and New Zealand. The company plans to offer the subscription option in the United States but has not announced a specific date.

In addition, Microsoft plans to launch a Web services plan, originally known as HailStorm and since renamed .Net My Services, next year. The plan will offer consumers a range of services from Microsoft and partners--including online calendaring, contact-list management, document and image storage, credit card information, and personal identification data--accessible from PCs, cell phones, PDAs and other devices via the Internet. Microsoft is still working out pricing details, but .Net My Services is expected to be offered on a monthly or yearly subscription basis.

Based on the introduction to its survey, Yahoo's tool suite could include such applications as word processing and spreadsheets. It also could allow people to import and export Microsoft Office and Adobe PDF files. It may also include 15MB of storage, with "the ability to purchase additional storage as you go," according to the survey.

Among many features, the tools could let consumers store, manage and edit documents from any computer or Web-enabled device. As a result, a small business could give an electronic presentation on a client's computer using documents stored with Yahoo's service.

Consumers could also store images on Yahoo and give friends the keys to access the files. It would also let consumers create directories of files, letting them control access to some documents and keep others private.

Topics: Microsoft, New Zealand, PCs, Software, Storage

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