Information Worker
Financial Analyst Meeting 2004
July 29, 2004

ANNOUNCER: Ladies and gentlemen, please welcome Senior Vice President, Information Worker, Steven Sinofsky.

STEVEN SINOFSKY: Well, good morning, good afternoon, everybody. I am really excited to have a chance to share with you the Information Worker business overview, and where we stand. I'm particularly excited because I did a pass-through and I saw a number of you using OneNote for this meeting, and even some of you talking about how you already use it, which is great to see. So, we got an extra demo in for the Information Worker business, so we're excited about that.

For this morning, I'm going to be pretty straightforward and dive right into the revenue numbers for the business; then go through some of the license metrics; and then I really want to talk about our product strategy through a number of different dimensions, including the competitive landscape, what we call our customer connections, and how we're living up to some of the promises that Bill talked about earlier. And then I'll wrap up with a look at where we're heading with our product road map moving forward.

So, just diving really right into the revenue, we had a terrific year with FY04 with the growth that John talked about on the call of 17 percent. The strong results we had are really due in part to the Office 2003 pricing and packaging decisions that we made. And so we're very excited about the results we saw there, particularly things like our pro mix, which is holding rather well; our Student and Teacher package is very successful for us at retail at reaching those customers that qualify; and at the OEM level, our Small Business Edition is doing quite well where we realigned the components of those products. And then, finally, at the enterprise level, we packaged the enterprise products that included higher-end features that are more appropriate to the enterprise customer, including XML, and the information rights management work. And so, altogether, those have worked really quite well for us. We also have had very good results from our non-suite products, including SharePoint Portal Server, Project, Visio, FrontPage, et cetera. We're quite pleased with the lineup of products we have outside of the core suite products. And collectively we call these our category products. And they represent over a billion dollars of collective revenue. So, we're pleased with that.

And, finally, we're seeing real-time collaboration revenue growing quite fast, and we have two products there in Live Meeting, and our Live Communications Server for on-premise server. So, we’re rounded out really quite well, and we feel quite good about the year.

As you look at the revenue slide, you can see the revenue from UA and how we replaced that with growth from all of the areas that we just talked about. And so you can see that overall as a well-rounded picture, it's doing pretty well. For FY05, our guidance is focused on the one to two percent range that was talked about on the call last week, and we see that coming from, first, continued momentum in the small and medium business channel for retail, and also with OEMs, where we are seeing some good strength. Clearly, from the June results, we're seeing our enterprise licensing customers moving to Office 2003. So they are shifting their purchases in licenses to Office 2003, and we're seeing the renewals and signing of annuity agreements shifting to 2003 as well.

We will see continued growth from the other IW products, the categories, and we feel we'll correct some of the issues we had last year. In particular, we'll start to see, we believe, an accelerated growth in businesses like Project, which turn out to have a longer ramp-up cycle due to the enterprise nature of the sale, than we had earlier anticipated. And, of course, we'll continue to see an acceleration in the real-time business, and we feel good about that.

Our target continues to be about 10 to 30 percent of converting the several million UA licenses that are there, and that's a good opportunity for us. And, moving forward, we'll certainly be able to learn more about how that's going as we go through the first quarter, when a number of the licenses are expiring, and when the grace periods are over, and things like that. So, that's a quick look at the overall revenue picture and our guidance for FY05.

Turning to the licenses of that picture, I think our FY04 mix matches the historical mix that we've seen recently with 40 percent annuity, 40 percent straight licenses, and about 20 percent OEM. For our annuity customers, they continue to renew at those historical rates. And so we feel that that is working for us. And our license-only customers are also accelerating their purchases of Office 2003. And so certainly at the launch we saw a quite strong presence of Office FTP launch, with a significant ramp-up there, and that really contributed over $100 million of incremental revenue for the fiscal year. For June or before, as I mentioned, we're seeing the license sales to enterprise customers really start to ramp up, and those were above our expectations.

And so, when we think about our enterprise customers and their shift to and from annuity and licenses, we feel we're really trying hard to maximize the opportunity for us and ensure that we sell the right licenses to the right customers. And so we've seen the growth in the transactional licenses, as well as the renewals of the volume licenses. And we're also seeing the annuity customers reach down to the small and medium business channel as well, particularly in the mid-market and the upper mid-market.

Then, finally, the OEM business for us, which is our primary way of reaching very small business and individuals, continues to be strong. So, again, the pricing and packaging decisions we've made there have worked out quite well for us. The small business edition, for example, we added the business contact manager, which really enhances the small-business offering for those customers. So overall, that's a picture of our licenses, and I think, again, we feel like we're meeting the expectations that we have for ourselves there.

What I'd like to do now is change over and talk about the product strategy that we've got, and the whole change that we're really undergoing with Office 2003, or the whole wave of products. When I say wave of products, it really is a very substantial number of different pieces of software that really came together with our launch last year. It's really been the broadest and deepest set of software that we have released to date, and we released it all within a very short time.

So we do expect it to take a while for this whole approach and this breadth of work to really sink in with customers, especially at the enterprise level where those evaluations can take time. But the Office 2003 product has been an incredible shift for us from the way that we had developed the software, and the way that we had focused our R&D efforts, and our communication of the results of those efforts. So when you think about Office, traditionally folks think about the client suite of applications--the word processor, spreadsheet, Word, Excel, PowerPoint, Outlook, and Access. And what we've done with the Office 2003 product, or the Office System, is we've really started to think of it as a series of programs--the traditional applications, if you will; servers, things such as SharePoint Portal Server, Content Management Server, and Live Communications Server; as well as a set of services that wrap around and integrate all of the programs and the servers, as well. So those services, whether it's the Office Online, or Live Meeting, all come together to really round out a great picture of a broad system of software that was designed from the beginning to work together. And that's a really great strength that we're bringing with this approach.

The other kind of dimensions that really change when you think about the Office system--Office traditionally was all about personal productivity--it's how fast can you type a memo, how many cells in a spreadsheet, and how can you make those slides faster and quicker, and there's a lot of innovation left in improving those processes. But, along with that what's really changed in the nature of work has been that all of those processes, that used to be one person working on one document by themselves, has turned into teams and organizational issues.

So now documents that come together are really worked on by dozens of people, often spread throughout geographies, or they're worked on as part of an organizational initiative that crosses organizational boundaries between, say, finance, development, and sales and marketing. And all of those different types of productivity that Bill talked about earlier are the kinds of things that are really baked into the Office system. So when you think of something like SharePoint Portal Server, you think of a product that's really built to bring together organization productivity. It's one place to search for all of your information, to tie together your enterprise information using the technology Bill talked about earlier called Web parts. And all of those together work well to expand the notion of productivity into a world of personal, team and organizational productivity.

Another dimension of this change has been that the old world for tools like Excel and Access has been really about just data publishing or modeling--create that model, report on the data that you collected, and move on. And just like with productivity, we've also changed the model of data and how we deal with it within Office. So now we're very focused on, first, data collection and doing a rich job of collecting the data, routing or manipulating, and reporting on that data.

So when you look at a new tool in the Office product called InfoPath, it's about using structured XML to collect rich information and do that accurately and reliably, all the way up to the innovations in Excel and Access for connecting to enterprise data, or our SharePoint Server family to report and analyze on that organizational data. So, again, the transition has been from thinking about it as personal data publishing, moving out to the whole notion of what groups of people, enterprises, or cross organizations do with that information in the Office System of products.

Then the next thing is really the traditional world of, “we do licensing and we train people.” And whether we train people, sell directly, or license directly or through third parties, it's very transactional in nature and very much, “here's the set of fixed functionality in the product.” We've really transitioned with the Office system to a real clear focus on solution development, enterprise integration, and then the broader notion of deployment and management of those desktops--many of the issues that Bill and Will Poole alluded to and talked about in terms of managing for the security of the infrastructure, managing for the deployment and management of keeping products up to date, and using a tool like systems management server. So a good example of what do we mean by a solution. Well, part of the Office System is something that we actually released over the past few months called the Information Bridge Framework. The Information Bridge Framework would historically have been the kind of thing that somebody would have kind of had to hack together themselves within their organization and not seeing the broad usage and support that we're able to offer.

What this framework does is it allows you to connect from within the Office application to the enterprise information that's really important--for example, if you're dealing with customer service escalation, and you've got to write a letter to a customer, or respond to a customer inquiry, having access to the CRM information about that customer directly from within, say, a task pane or a window within Microsoft Word, to automate the process of including that information. “We notice you contacted us on a certain date, your customer number is the following, or please refer to this service ticket number,” are all great ways of really integrating that line of business information and creating a complete solution, rather than just, “here's the place to type the letter, and it's up to you to figure out how to get the rest of the information into it.”

So when we think about the entire Office product line, we really think of it in terms of a system--a set of integrated products that we're evolving, and working together to solve a much broader set of productivity problems that people have--and really sort of up the ante of the kind of things that the PC can do for you in the workplace to get your job done.

So with the launch of Office 2003, that's when we really started to talk about it as the Office system. And I think it's fair to say that this is really catching on with customers, and really seeing a deep understanding of what we're trying to do. So what I'd like to do is show a video of BP, through our early users of a broad set of products within the Office System. So let's take a look at that.

(Video segment.)

So that's a really great example of where customers are seeing both sides of the value equation that we're touching with the Office System. On the cost side, the cost savings that come from the innovations that we've done by clever use of network bandwidth and better administration and deployment tools, and then on the value side, for sharing information and collaborating across a very, very wide organization.

Of course the challenge with the Office System is that we can't do it alone. And the product has a great set of opportunities for partners, and we just love the partner opportunities that we've made available with the Office System. And we're seeing just an unbelievable level of support among our partners. We have over 2,300 Office solutions, and we've trained over 70,000 partners in the use of the Office System. And they're out there building, deploying, and servicing information worker solutions with Office.

What are the kinds of solutions that we mean? We mean partners are out there helping with the basics of deployment--getting the software out there and customizing it with the rich, enterprise-level customization tools in the product. We're seeing basics like improved file sharing, so that with Windows Server and Windows SharePoint services, file sharing takes to a whole new level with the access of a really rich Web user interface, and the ability to set roles and responsibilities, and really work super well over the Internet and with HTTP file access.

We also see custom information worker solutions, whether it's a training solution for an organization, or project management, or enterprise project management within a company. One great partner of ours does a great deal of work, PQ out of Michigan does work using Project Server and Project for enterprise project management. And this is just an unbelievably rich area for us, and represents a significant growth opportunity.

Where historically we thought of Microsoft Project as the way that one person with the business title project manager uses Project, feeds in all the data, and everybody else does the work. And what we're seeing, particularly with projects run by information workers, whether those are marketing plans, or R&D activities, is that that information isn't as good as the kind of information you can get if all of the people that are participating in the project on a daily basis are contributing the information about what tasks they've accomplished, what new tasks have happened, and the dependencies on their project and things like that. And with an EPM solution, done by partners such as PQ, we can see incredible gains in efficiency.

So, for example, we have a global foods company that does all of its product launches using an EPM solution, and it has offices in over 100 countries that are all connected using the EPM solution developed by a partner, using both Project and Project server. So people every day come into work, they look at what's going on in Outlook in their task manager, they're able to integrate that with the global EPM system, and then back at the headquarters they can roll up this data across all the projects, all geographies, and see an integrated view of that project management. And so you can see how integrating with familiar tools like Microsoft Outlook, you can have an incredibly rich experience that also presents a big opportunity in business for us and for our partners.

Another great partner of ours, just to mention one internally, is the Microsoft IT group, or MSIT. And they’re a great partner because they’re our first customer and our best customer on many of our technologies, but they're a leading user of Windows SharePoint Services and SharePoint Portal Server for us. And we've been very aggressive users internally of this technology to the point where probably about half of the Microsoft employees have what we call a "My Site"--a personalized Web site that's available just by clicking on the company portal, MSW. You just click on My Site and we create a personal site for you to keep the documents you want to share with people, the documents you might want to use when you're accessing privately from a kiosk located somewhere on campus. You can publish shared calendars, shared lists of information, all sorts of stuff on these personalized sites.

At the other end of the spectrum, we've got over 3,000 extranet Web sites that we've created. So, if you're in our field sales organization or doing customer research, or need to work with a partner, through MSIT they're using Windows SharePoint Services to create extranet sites that allow secured access to information and sharing through the Internet for our customers and partners. So, those are great examples of opportunities for partners that are really helping to generate new business, generate new ideas, but most importantly really expand the role that our Office system plays in solving information worker technology challenges.

And the results of this have been pretty good. We've really gotten some quite strong product reviews for the Office System products as a whole. Particularly, features like the new Outlook has great features for network connectivity, network bandwidth. The New York Times called it a godsend for people who use Outlook quite a bit. And we've really received a lot of positive feedback, both on the cost side, and then we redesigned the user interface to streamline the role that e-mail can play--features like being able to have a mail message exist in more than one folder. And through these smart folders, you can use rich, rich queries, or define rich interfaces for gathering the e-mail as it relates to, say, a project or different projects or geographies, or however you'd like to organize your e-mail.

And we've also gotten great reviews on some of the new products. InfoPath is a product that's really revolutionizing the way that you can integrate structured XML data with rich form-collection, data gathering functionality, along with backend services, either at the out-of-the-box end using Windows SharePoint Services, all the way up to the sophisticated enterprise end using our BizTalk Server to coordinate and collaborate among different business processes. And then, of course, putting the data into SQL Server using the rich XML capabilities. And this is a completely new way of looking at the data gathering, collection and dissemination of information. And so we're really quite pleased with the reviews that we received on the product, and having worked on a bunch of releases of Office, these definitely are up there in terms of the very best reviews that we received, and also the very best comments that you can get on the street from folks that use the product on a daily basis.

So, I would like to turn a little bit and talk about some of the competitive challenges that we face as a business, because as we broaden our product line and include the full notion of an integrated Office System, it makes sense that we're going to start to see even more competitors than we've traditionally seen around the world. And while we still have a number of strong competitors in the traditional suite market, if you will, the breadth of competitors we're facing now is greater than we've ever faced. And, of course, the number one competitor that we consistently have to deal with is the fact that many, many of our customers are satisfied with our existing products. Our customer satisfaction is fairly high, and people don't know or aren't aware of the benefits that we can bring to the whole Office System. So, it's not uncommon for people to say, oh, the old version is good enough, or this alternative might be good enough to use.

And the way that we're approaching this is twofold. First, we're developing innovative new scenarios and new tools. And so products like many of you are using today, OneNote, completely changing the landscape of personal productivity for using a laptop and a wireless network or using a desktop to do research and reference, and it's just a whole new category. It's a new tool, a new way of thinking about personal productivity. So, that's an innovative and new way of expanding the business. On the other hand, we're also adding deep new features to the product to really enhance that core productivity experience of spreadsheets, word processors, e-mail, and things like that.

So, for example, Office System has a feature called Information Rights Management, which really enables you to restrict the access to a given document. So, if you want to e-mail a document to somebody over to another company, or another organization, but you really don't want them to forward it around, you can use rights management features to enable that document to only be printed, or to not be saved, to not be forwarded. And you can maintain complete control over that proprietary information and really make sure that you're managing the information that you create in an effective way. And so we're both expanding the horizon of products, as well as broadening or deepening the innovation within the core Office Suite.

At the enterprise level, we see a lot of competition clearly from the enterprise software vendors, whether they're in the solutions space, or the consulting space, or building enterprise software products. And I really feel that for us the integrated innovation that we're delivering is itself a unique customer value proposition, because no other software vendor is bringing to market the breadth of software for information workers that we are--as we scale the basics of word processing, through e-mail, through team and individual collaboration, all the way up to enterprise, content management and portal servers. And all of these, as Bill talked about, are based on the core interface experience within the Office Suite, and really building a familiar environment that allows these enterprise line of business functionalities to be integrated with that whole process in the information worker's world.

And our collaboration story is really the cornerstone of this. Starting with Windows SharePoint Services, and building up through SharePoint Portal Server, Project Server, and our Content Management Server. And all of those together really help to build the deepest and broadest collaboration story. From a business side, there are a lot of opportunities for both incremental and new revenue with the enterprise software that we're delivering as part of the information worker system, the Office System.

And then, finally, we have a bunch of worldwide market challenges, and Will Poole talked about the challenge of piracy and intellectual property in a number of markets, and, of course, we face very similar numbers and very similar challenges there. And our approach to this is one where we have two things that we want to do. First, we are going to have tailored or market-specific offerings. And so, what we've been doing is really trying to deliver products that are unique and customized to the marketplace that we are delivering. So, for example, in China one of the features of the Office System is what we call our English writing wizard, or English writing assistant. And this really helps people who are writing documents in English, or in Chinese, that are technical, and they're working with a source of information that's in the other language. And so while you're typing in English, you can hover over a Web page with an English word on it and look up the definition; the context; and, most importantly, how you correctly use that word in a sentence, in a different type of sentence, which are challenges that people face when writing business communications in other languages. And you can see us expanding that to a large number of markets where writing itself in other languages is a real customer issue. And, in fact, there's a vibrant market of tools for add-ons and things like that all around the world, and I think that we've been focusing on using the work from Microsoft Research, the linguistics work, as well as our investment in proofing tools and spelling, in all of these unique markets to deliver a great set of writing tools. At the other end of the spectrum, we're creating completely unique local market products. And so this fall, we're going to announce a project in Japan called Microsoft Office Interconnect. And this is a unique product for us which we've already started beta testing and releasing in Japan, and we've had some initial press and articles on it already. And this is a product that's uniquely tailored to the Japanese market of essentially what we would think of in the United States as contact management. And so it allows you, as an end user, to have a unique business card, electronically, that you e-mail around with that secure digital signature, and allows you to track your name card as it travels throughout all of your contacts. And if you change jobs, get a new phone number, or get promoted and change your title, you can automatically notify all of your colleagues and connections with this information. And it does so in a secure, e-mail based, peer-to-peer mechanism. And so it's a unique approach to a unique problem that people spend a lot of energy tracking and dealing with in Japan.

So, we're very excited about, overall, about how to deal with the competitive challenge that we have, whether we're pushing on the innovation for individual productivity, or the breadth of enterprise level functionality, or really working the local angle and expanding the geographic richness of the Office product. And so what I would like to do is show you the innovation at work with another video from a law firm on the use of one of our great new products.

(Video segment.)

I mentioned earlier about the innovative customer connection. So, I would like to talk about that a little bit in terms of how it is that we are connecting with customers on a daily basis within the Office product. I'm guessing this hasn't happened to many of you before, but occasionally throughout the use of one of our productivity tools, you might experience a crash. Nobody raised their hands, so I guess that didn't happen. But really, we receive a lot of feedback from customers about the stability and reliability of our products over the years. And so, starting with Office XP, we added the feature of being able to report back to Microsoft that you experienced a crash. And this is voluntary, it's anonymous, and it's off by default, but nevertheless, we receive a very large number of reports back indicating that the software has experienced a pretty severe problem.

And so, since Office XP, we've been fixing these crashes in real-time in the product, and releasing them in the service packs and through the development of the product. So, with Office 2003, when we did our first beta, we would measure the time it took from starting the software until there was an actual unfortunate fatal error in the software. And from the time of the beta through the RTM we ended up improving the reliability by that measure by a factor of seven. And what's so great about that is, we really know precisely how much we improved it, whereas before, without that connection to customers, we really didn't know. And then, with Service Pack 1, we continued to enhance that reliability even more, and so the product is actually 25 percent more stable than it was when we released it from manufacturing the first time.

Now, the neat thing about it is, because of that work we had done during the course of development, the original RTM release was already the most stable release of the product that we ever did. In fact, just yesterday and this week we've released the first service pack, and a director of Microsoft was quoted as saying, “Well, it's great, a nice service pack, but they really didn't have any issues with Office 2003 RTM code, so no customers have really been held up or waiting for the Service Pack 1,” which for me, as an engineer, is the highest compliment in terms of the stability of that RTM product. And so what we've really done is made a significant change in R&D in the product by really focusing on this real-world data and experience.

And the next area where we have this ongoing data-centric connection with customers is Microsoft Office Online, which is a Web site that customers can connect to from within the Office product, or directly through a Web browsing experience, and this Web site is really an integral part of the Office System. We consider it an everyday part of using the product. We have over 40 million unique users per month to this Web site, which puts us in the Nielson Top 50 for a productivity site that's entirely focused on helping people get work done. And so it has assistance, tutorials, movies, clipart, and templates, and so let's just take a look at what some of the content is that's on this site.

What you can see here is, this is just the home page for it, and you can actually see that it's a program site, we have downloaded summer clip art. We have over 400,000 images on the site already today. If you access it, depending on the SKU that you're using when you access it, if you use an older version of Office you might see ordering a trial CD, or reasons to upgrade; a newer version of Office you might see, “hey, we notice you're using student/teacher, these are issues to see with how to use Office in the classroom.” We've got over 5,000 templates for our customers to use, which are accessible by just doing file and move in the Office client applications.

So really this is an integral experience to using the product. You just say something like, “insert picture form clip art,” and you're connected to the Web. If you say, “okay, I need some help,” you're going to look locally, and then you've going to connect to the Web for that help, as well.

Here's an example of the site from the United Kingdom, which is showing the U.K. templates for the small-business user. You can see here we have how to compute the VAT, we have VAT invoicing templates, we have invoice templates including a tax; so it's very tuned not just to the small-business user, but also tuned for the local market, as well.

We have movies, and quizzes, and all this content is rated by customers after they use it, so we receive over 25,000 ratings every day. So since we released Office 2003, we've written or improved over 3,500 articles based on customer ratings. It's really a great asset for us.

As Bill mentioned, one of the core focuses we have is on learning about how different types of customers use the product, and really focusing our energies on making that better. We have a core focus on understanding different professions. So here you see the human resources profession, where we'll go through and talk about using Office as a human resources professional. And you can see us over time developing this into an asset where we talk about a best practice, how to do performance reviews, or how to do an employee handbook, or things like that. Moving beyond just the templates and the content, and the product training into true professional expertise and skills.

So it's a really great asset for us. In fact, it's a great asset for us all around the world. I just wanted to show three of the worldwide sites from Estonia, Thailand, and India. We've actually localized this in over 20 languages around the world, and what's really key is that we have access for local partners and local content. So there will be templates that are specific.

For example, the clip art in China is different. In fact, we started promoting clip art of monkeys when it was the year of the monkey, because that became the most popular download of clip art just on the China Web site. And it's a really great way for connecting with customers, and really delivering on that kind of value. So it's a big investment for us, and it's a really great way to just be connected day in and day out.

The way to think of this is that by connecting this way, we're constantly improving the product. So this is a really unique value proposition that we bring, in that it's not just us thinking about what to do, and releasing those changes over the years. In fact, it's an ongoing improvement of the product, precisely the way that customers are asking us to improve the product.

In the marketplace, even for traditional productivity software, this is extraordinarily unique. On top of that, this notion of being connected with customers to improve product quality is something that you'll see in all the Microsoft products. So every one of the products that is sending in these crash reports, is addressing the issues of the product. So I feel that our connection points with customers are broadening, and the way that we're working them is really providing a unique advantage for us. I'd like to wrap up by just talking about where we're headed in the productivity investments. Of course, we're very excited about Office 2003. We're really just getting started with it, so that's clearly the focus for this fiscal year on the products. But, back in the R&D labs, we're focused on building a new generation, or a new wave of productivity software. The first thing, and number one on our list, is exploiting the technologies of “Longhorn,” the technologies that Bill mentioned and that Will Poole talked about, as well.

We have a lot of focus on ensuring that our corporate activity experience from Microsoft represents the best work that we can deliver with the “Longhorn” platform. We're also investing and innovating in a core set of productivity scenarios. First and foremost is our continued investment in trustworthy computing. So we're fixing those bugs that customers report; we're fixing, improving, and adding articles in the Office Online Web site; and we have a broad set of instrumentation that's being built into the generation of software that's out there today, and improving in the next generation. That will connect an even deeper set of concepts back to Microsoft, in order to improve our products in those unique ways.

We're also clearly focused on document collaboration. So going from this day of just typing a document in Word, sending it as an attachment, how do we expand that to include the organization or team productivity features that make document collaboration easier? Whether it's individual features like change tracking, or features like check in, check out, versioning, and workflow that are really important for the document collaboration scenario.

We clearly have a big investment in the enterprise portal space. So building up our connection of the Enterprise Portal to line-of-business data through the Web part technology, building up and improving our search investments that are already a leading investment in the portal space, and doing a great job of integrating our portal with our team collaboration features, both on the server, and in the client, as well.

Our ongoing and continued investment in real-time collaboration is a key part of the Office System. So that our individual team and enterprise productivity all expand to include not just server-based, ad hoc productivity, but real-time collaboration, as well. It's a super important part of the Office System.

As I mentioned earlier, our desire is to continue to expand the role that our tools play in business information reporting and analysis, going from a place where Excel is just a landing pad for data to a world where Excel and Access can be used for connecting to line-of-business data in real time, not by just IT developing solutions, but by individual information workers and rich interfaces that can connect to line of business data, using the power of XML, the power of Web services, and bringing those together in a really great way that focuses this line of business data in new ways for people.

Finally, we're going to continue to invest in our new categories, such as InfoPath and OneNote, expanding our existing categories like Project, Visio, and FrontPage, and over time introducing new categories, whether those are geography-specific, or worldwide. And our investment in our growth opportunities in the categories continues to be something that we are very optimistic about.

The thread running through all of our investments in integrated innovation is our ongoing connection with customers. Whether its learning from them in our labs, in usability labs, or learning from them through the data that they're sending to us on a daily basis in very large amounts, we are really deeply committed to taking that and turning it into features that customers really want and will appreciate right out of the box, out of the gate, with our software.

So with that, I'd like to conclude. We had a great last fiscal year. We are very excited about the work that we've got going on for Office 2003 and the customer adoption, support, and enthusiasm that we're seeing with our customers licensing and buying Office 2003. And then moving forward, we have a great deal of investment to significantly enhance the Office System and our connection to customers.

So with that, thank you very much, and have a good rest of the day.

Due to the varying sound quality and subject matter of tapes, the information in this transcript may contain inaccuracies.