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As software releases go, they don't get much bigger than a new version of Microsoft Office. Microsoft's famous application suite isn't just software's 800-pound gorilla, it's King Kong and Godzilla rolled into one. Analysts estimate that Microsoft commands 95 percent of the office application market, despite competitors like Corel WordPerfect Office and Sun StarOffice.

Later this year (no one knows exactly when), Microsoft will unleash its latest version--Office 2003--on an unsuspecting public. There's just one problem: Microsoft has passed the point of diminishing returns on its Office updates, and users are figuring it out. Office 2003, currently in preview form, may not set consumers afire; but businesses may like what they see. Here's a sneak peak.

Suite Tweaks

Office 97 was widely regarded as the first buy-and-hold version of the all-in-one software behemoth, and with each successive release the case for buying the latest update has thinned. Stalwart apps like Word, Excel, and PowerPoint have aged gracefully after fitful childhoods. Now they offer a ridiculous excess of features and friendly interfaces.

When I installed the latest Office 2003 beta, my first impression was how little everything had changed. There were few surprises, but there were a lot of tweaks. Word gets a Reading Layout view that makes fonts easier on the eyes. Excel offers new ways to troubleshoot formulas. Publisher finally steps out of the playpen with a host of business-savvy templates and designs, as well as some impressive tools for creating Web pages and publishing catalogs. And every application gets a dose of Microsoft's Smart Tags (first introduced in Office XP), which provide context-sensitive links and automated tasks. For instance, when you type a date into a Word file, a Smart Tag appears that lets you schedule an appointment in Outlook.

There's the usual interface polishing across the suite, including subtle icon treatments that are both rich and soothing. But the biggest splash comes from the ubiquitous new task pane, a small window that provides context and guidance across all applications. You may find yourself accessing Help, Clip Art, and the useful new Research feature (which searches online reference sites) from the task pane. This interface also serves up context-savvy controls to help you master new tasks.

Alas, the task pane is also profoundly flawed. It appears unexpectedly, obscures large swaths of screen area, and can leave you without a clear path back to what you were doing. If my experience is any guide, you'll develop a love-hate relationship with this new feature--kind of like pulling for Godzilla even as he levels Tokyo.

Microsoft Outlook 2003 is arguably the most improved application of the lot. A do-it-all e-mail program-cum-personal organizer, Outlook 2003 adds a welcome junk mail filter, improved shared scheduling, a retooled navigation pane, and some nice sorting and grouping capabilities. There's also a new three-column preview mode that makes it easier to see the contents of messages without actually opening them. But aside from the junk mail filter, which was sorely needed, the improvements to Outlook are mostly evolutionary, not revolutionary.

Sideshows Take Center Stage

Actually, many the best improvements aren't even in the Office bundle. The vastly improved FrontPage 2003 Web editing application, for instance, is part of what Microsoft calls the Office System--an extended family of products that includes the various Office suites and side applications such as OneNote, FrontPage, SharePoint Portal Server, and Visio. These applications may carry the Office name, but they must be purchased separately.

Ironically, these sidecar apps got the most extensive treatment of any in the Office System. FrontPage sports a useful new split screen view that displays code and design views side by side--a nice touch. But what merits acclaim is the retooled code-generation engine, which finally produces clean and consistent HTML from pages produced in the WYSIWYG (what you see is what you get) design view. This enhancement fixes a shortcoming that Web developers have decried bitterly for years.

The new Microsoft OneNote is an intriguing application that makes it easy to jot text, capture documents and images, and even sketch drawings. A terrific tool for notebook-toting students and busy project managers, OneNote was pulled from the Office bundle before the beta 2 release and will be sold as a separate product.

The Mind Behind the Monster

Regardless of what is or isn't in it, any suite upgrade is nice to have. You get the latest features (even if they don't wow you), bug fixes, and up-to-date technical support. But at the prices Microsoft usually charges for these things, folks may think twice. The company hasn't said what Office 2003 will cost, but it isn't likely to be cheap. The Office XP Professional Upgrade recently was going for $288 at PC Connection, while the full stand-alone version was fetching $448. Expect Office 2003 to command prices north of those figures--for what users may determine is little more than a space-hogging task bar and a few new templates.

The fact is, Office 2003 probably won't be a slam-dunk upgrade for current Office XP (and even Office 2000) users. But Microsoft isn't aiming this upgrade at those people, but rather at the hardened ranks of IT managers and system administrators who spend their days trying to figure out how to make things work together.

That's where Extensible Markup Language comes into play. XML is a language used on the Web that lets programs share information regardless of where it came from. Virtually every Office 2003 app speaks XML, making it possible for IT gearheads to link the software on a worker's desktop PC directly to server applications. Home users won't be tapping this feature often, but companies may sign volume contracts with the hope of streamlining communication between Office 2003 programs and every other system in their organization.

In fact, many significant new Office 2003 updates have nothing to do with ordinary consumers and everything to do with big business. The Information Rights Management feature helps keep Office files from falling into the wrong hands. Microsoft's improved Windows SharePoint Server lets Office users share workspaces, collaborate on documents, and exchange data about schedules and projects. Finally, high-end Office versions come with a Business Contact Manager application that plugs into Outlook to add customer relationship management capability.

"So what?" you ask. For many consumers, that's exactly the point.

Is Microsoft Office a must-have upgrade? Ultimately the answer depends on the applications you use most. Folks who live in Outlook and Publisher will have a lot more reason to upgrade than those who rely on Word and Excel. A move to Microsoft Office 2003 clearly will be more useful to corporate IT managers, however, than it will to the rest of us--who may well consider Office 2003 to be more of a gecko than a Godzilla.

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