If you've followed Microsoft Office through its succession of lackluster upgrades in recent years, you might be excused for yawning at the prospect of the 2007 version. Well, wake up: The 2007 Office System is by no means just another collection of incremental tweaks to the world's most widely used productivity suite. What does that mean for users who already live and work in older versions of Office? Like any software that undergoes significant interface changes, the 2007 apps impose a more-demanding learning curve than their predecessors did. But we've found the adjustment worthwhile: This is clearly the most compelling Office upgrade we've seen in recent years. You can download the suite from a special page of the Microsoft Office Online site and check it out for yourself--free for 60 days.

In our full review, we've evaluated and assigned PCW Ratings to the whole suite and the individual core applications--Word, Excel, PowerPoint, Outlook, and Access. In determining the overall suite's PCW Rating, we used the $399 version (Microsoft Office Standard 2007), which bundles all of the reviewed applications except Access. We weighted the price component slightly lower than design, features, and performance, since we figure that people who need Microsoft Office will end up buying it despite its hefty cost. Also, in gauging the PCW Ratings of individual applications, we assumed that buyers would purchase them as part of a suite, so we used a neutral price rating rather than the application's stand-alone price. For more information on the eight different Office 2007 suite configurations (five are sold in stores), the apps they contain, and how much each one costs, visit Microsoft Office Online. For more information on PCW Ratings, see "A Guide to PC World Ratings."

The applications we reviewed sport both a dramatic new look and new underpinnings in the form of XML-based default file formats for Word, Excel, and PowerPoint. The changes have a collective purpose: The redesigned interface makes finding and using these applications' powerful features much easier, and it is especially useful if you want to make your documents look their best. The XML file formats reduce file size, let corporate users easily transfer information between applications, and automate formatting and other changes across huge libraries of documents. Since they're based on an open Microsoft spec, rival productivity apps should eventually be able to duplicate and work with Office documents faithfully.

For network-connected workers, the suite provides more tools than ever, including the new Office Groove collaboration app, and support for wikis and blog posts. These features become even more useful for enterprises that invest in Office server products, such as SharePoint Server or Groove Server.

A Whole New Look

The sweeping design changes in Office 2007 can be unsettling. Instead of depending on myriad cascading text menus and skinny taskbars, most of the action in Office now takes place in a fat band or "ribbon." It appears where the taskbars used to be and graphically displays features that change as you click the different menu bar tabs.

You may have to scramble at first to find the new locations of familiar options (Microsoft provides extensive online help). But the ribbon may also introduce you to tools and commands you never knew existed. In addition it supports a useful new feature called live preview: Select all or a portion of your document, hover your mouse over a formatting option (a new font, for example), and you'll see how it changes the actual document's appearance. If you like how it looks, click to apply the change; if not, move on to another option. This feature makes experimenting with style changes easier and more fun than ever.

In case you miss having a few frequently used commands always at hand, the Quick Launch toolbar gives you a place to pin commands from any of the application's ribbons. It's not perfect: I miss being able to add boilerplate text with a single mouse click on one of the AutoText toolbar buttons I created. But by default, the Quick Launch toolbar includes some highly useful commands, including Undo and Save buttons.

XML Marks the Spot

Microsoft's decision to use its new Open XML file formats (distinguishable from the old formats by the addition of the letter x to the file extension--.docx, .xlsx, or .pptx) as the defaults in Word, Excel, and PowerPoint is likely to irritate people who don't have the 2007 versions of these apps and receive documents from people who do.

Microsoft has tried to minimize the pain by quietly shipping Office 2007 awareness patches to Office XP and 2003 users who keep their suite current--by using Windows Update, for example. People who've received the patch and try to open an Open XML file within Office XP or 2003 will get a pop-up window informing them that they need to get a 2007 Office Compatibility Pack--a free, 27MB download. With the Compatibility Pack installed, Office XP and 2003 users will be able to open, edit, and save to the new Open XML format.

Unfortunately, people who try to open Open XML documents in older versions of Office or other productivity suites will encounter messages saying that the application can't open the file. Your odds of reaching the Compatibility Pack improve if, instead of launching an older productivity application, you click on a file to let Windows try to open it. The OS will still tell you that it doesn't recognize the file type, but you'll have the option of letting Windows go online to find an application that can open it--and that way you'll get to the Compatibility Pack. With the Compatibility Pack installed, Office 2000 users gain limited functionality in the XML formats; and all other users will be able to convert Open XML documents to Office 97 formats and back again from Windows, though the process isn't particularly intuitive. See "Using New Microsoft Office 2007 Files with Older Office Suites" for more on opening Open XML files in older applications.

Basically, Microsoft's Open XML formats sort the various components of a document--content, formatting, comments, and so on--into different files that the software then zips into a single Open XML file. (You can check this out by changing any Office XML file's extension to .zip and then opening the file with any zip utility.) Using zip compression makes files smaller; separating content from other attributes enables you to change those attributes without changing the content. A corporate user could, for example, change the look of a series of documents by swapping out the formatting files.

In the end, you may decide that your current productivity apps are all you need. But if you'd like to get the most out of Office applications, this upgrade can help you do it.

(See our complete review for our in-depth look at the suite's individual applications.)

Yardena Arar