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Web-Based Office Live Offers Basic Services But Isn't Very Flexible

By WALTER S. MOSSBERG
February 23, 2006

The computer industry is pretty good at serving huge corporations, which buy technology products through specialized information-technology departments. But the industry has been mostly clueless about very small businesses -- companies with, say, fewer than 20 employees and no IT staffs. These businesses buy their technology products like consumers but have different needs.

Now, Microsoft is mounting one of its periodic efforts to create software for such little businesses. The company has rolled out a beta, or test, edition of a new Web-based software suite called Office Live. It is aimed at helping really small companies create Web sites, handle company email, and manage key aspects of their businesses -- like customer data, sales campaigns and employee expenses -- using only a Web browser.

Office Live, at www.officelive.com, is a set of Web-based applications. That means the programs don't reside on your hard disk but live on Microsoft's servers. This approach isn't new, but it's all the rage now, and it's part of a trend some in the tech industry call "Web 2.0." Microsoft is working on a whole series of such products and services, all with the word "Live" in their titles.

I've been testing Office Live, and I generally like it, though it has some rough edges and the applications it provides are pretty basic.

Confusingly, Office Live has nothing to do with Microsoft Office, the company's productivity software suite. It doesn't include Web-based versions of Office programs like Word, Excel and PowerPoint.

Office Live is free during the beta period, and a basic version, offering just a customized Web site and five email accounts, will remain free. Two other versions, offering the suite of online business programs, will require a fee of at least $30 a month, though Microsoft isn't yet saying exactly how much.

The heart of the service is a program for designing a Web site for your company. You get your own domain, or Web address, like "yourbusiness.com," registered in your name, not Microsoft's. Even though your Web site will be housed, or "hosted," on Microsoft's servers, people can reach it directly by typing in your address.

The program for designing your Web site is pretty simple but also a bit rigid. You start by choosing a template for your industry. There are 25 choices, ranging from accounting to travel. You can then customize the template, changing stock photos, layouts and color schemes, and adding your own text to various elements of the site. Then, you use a detailed page designer to create each page. No technical knowledge is required.

You can check out a very basic Office Live test site I made, for a fanciful, fake company, at www.waltwsj.com. It took me less than an hour. While sites created in Office Live can be viewed in any browser and on both Windows and Macintosh computers, you can only create the Web site on a Windows PC, and you must use Microsoft's own Internet Explorer browser.

Also, there may be a waiting period for you to gain access to the service during the beta period. And it takes up to 24 hours for your new Web domain to become operational.

The templates are OK, but they aren't nearly as varied or attractive as those available at Homestead.com, another site that offers quick Web page creation for small businesses. And some aspects of the system are annoying. For instance, the typeface on my site's top-of-the-page banners is too small, but Office Live wouldn't let me change it. I also couldn't use one of my own photos, instead of the stock picture, in the banner.

If you quit Office Live, you get to keep your domain -- in my test example cited above, it's waltwsj.com -- and switch it to a server of your own or to another hosting company. But Microsoft won't help you transfer your Web pages off its servers.

Beyond the Web site, you get a bunch of email addresses that you can use for either employees or generic functions, like sales, or both. You can manage this email online at Microsoft's Hotmail service, or, if you have the paid plans, in an email program like Outlook or Outlook Express.

And then there are the online business management programs. These are all clustered into a "Dashboard," from which you choose which ones you want. There's a calendar, a contact manager, a customer support page and a simple project manager. In addition, there are simple trackers for monitoring the competition, the progress of sales campaigns, and employees' data, hours and expenses.

These applications worked fine, but they are very basic -- mainly tables and lists. And there are no financial tools for keeping track of receipts and disbursements, so you'd still need something like Intuit's QuickBooks.

Office Live also provides shared sites for collaborating with vendors or partners. But there's a downside to having all your data online: It isn't available if you're offline, and it's vulnerable to being lost or stolen if Microsoft screws up. Some, but not all, of the data can be copied to offline applications, like Outlook or Excel.

In general, Office Live is a step in the right direction. But it could be more flexible and sophisticated, without getting complicated. And it could use some sort of local backup option.