Pace 78 NRS | In Spreadsheet War, Excel Poses This is the | fifih of a series »on the strategic directions that Lotus Develop- meni Corp. is pursuing and the significance of Uwse strate: gies to organiza- tčons planning , Jor the 19905. Lotus 1-2-3's long- overdue up- grade has provid- Ned competitors with a marketing advantage. 1-2-3 re- lease 201 is being challenged by several products that offer a greater number of features at less cost. If spreadsheet-buy- ing decisions were based only an fea- tures and cost, alternative products al- ready would have gained a much larger share of the market. 'The competition attacked the ihdomi- table 1-2-3 spreadsheet market by pro- viding features such as enhanced graph- ies capabilities, an undo command, search and replace facilities, intelligent recalculation, background recalculation, a macro learn feature, linking of spread- sheet cells, three-dimensional spread- sheets, improved memory management, and mnemonic cell notation. Features Lotus Lacks Most of these features are available to 1-2-3 users through add-in or third-party products. As a result, more demanding users have tended to buy add-ins rather than move to alternative products. While this causes the price-to-perfor- mance ratio to become even less favor- able, it has been possible to meet many of Uhe needs of "power users" by adding in outside functionality. Aecording to industry projections, the total number of spreadsheets sold in 1989 will exceed 3.5 million. This would represent a 25 percent increase in unit sales over last year. With this large a market, there is plenty of room for com- pelition. 1-2-3 has dominated the market since it took the lead from VisiCalc in 1982 and should continue to dominate for the foreseeable future. š | The software industry is seeing the sigus of a gradual slowdown from the Mmeleoric growth of the past two years. The expected effects of a sl i nelude a slowdown will (Even tompetition, a consolidation of vendors K [nij and some busi. FUAMEŠ/! S MNATIK ection of software. 9 A convergence of DOS and Windows 30 Jnay occur, leaving Lotus at a com- petitive disadvantage, 9 The move to OS/2 and Unix will begin slowly. To lure users away from DOS, Products must be highly integrated and must, clearly demonstrate superiority, ? Boundaries between databases and. spreadsheels are blurring. New Products a RN out knowing whether the source was ag spreadsheet'or a database. € Integrated local area network comput- ' ing environments will replace islands of computing on PCs. Therefore, Lotus seems to be banking on a cross-platform .. implementations of 1-23 interačt with a: , of these Microsoft standards. strategy. IDEM 8 Direct competition on features is in- sufficient to move current users away |: Integration of products with other soft.:. ware will assume more importance as:/.| users demand greater functionality: ' international markets will become more important, reguiring more efficient, marketing and support to customers to": e o vrni: sz.Seriou. Il bsije rsSvilgi. Lotus intends for strategic products, Sučli aš 1-2-3 (o reside on all the impor- tant operating systems and plaitormejh ing features and functions common S lise 123. In this cross-platform strategy, all ;. ,tation Manager and Xenix are examples common applications-program interface, called DataLens, that provides; | bidirectional access to, data sources. proach, one in which access to main- frame and departmental minicomputers is achieved through products such as SOL Server.'; | '/s : Koban SOL Server. is a multiuser relational database-management system from; How Lotus', Microsoft's Corporate Computing Strategies Differ implementations of Lotus On-Line Applicationi$ ti Threatto,1-2:3 če klade Vi, tation toward applications and intends (5: to leverage the power of its 5 million from an installed world-class product. ////4/// Microsoft is pursuing a different ap- (| '//' tion from 1-2-3 to its database product Kol vb INOVEVBER 27, 1989 4 Maki ERI io |. Another significant difference can be ika Microsofta orientation toward . operating systems. Owning a standard appears to be extremely important to Microsoft. DOS, Windows, OS/2, Presen- il In contrast, Lotus maintains an orien- spreadsheet, users by making the transi- an easy one. j The strongest competitor to Micro- ' | softs Excel will be the as-yet-unreleased 1-2-3 version 83. But until Lotus releases version 3, it will be unable to compete v against Microsoft. The electronic spread: -sheet market. is now waiting to see the benchmarks. . um ,Microsoft's Mac Attack ii Meanwhile, Microsoft Excel has cap-: tured almost 15 percent of the market v and holds the major share of the Macin- tosh market with its Mac version: Lotus' 1-2-3 for the Macintosh is not due until 1:1990, which allows more than five years | for Excel to establish dominance, while. » Microsoft.s.Mac product has been on the | product since 1985. pi mete 14? "The market shares are shifting so that ; Microsoft will garner a projected 15 per- i cent to 18 percent of the PC spread- " sheet market by 1990. It-remains to be seen what effect 1-2-3 release 3 will ; have on this trend, but it is not likely »that there will be a dramatic shift injei- | ther direction. H iin 4, In short, Microsoft Excel will continue (to gain market share, but Lotus should cbe successful in slowing this trend with (its new releases of 1-2-3. Most likely, a' zi massive marketing campaign will be waged by Microsoft to counter the ef." (ifects of release 3.'%/; | Ni ppi ie | With a declared strategy of moving its : products to OS/2 and the Presentation |; Manager, Lotus is vulnerable because. |, Microsoft will have had a Windows ased spreadsheet on 'the market for K (more than two years by the, time 1-2-' /G is shipped. "S M4) 1 The Macintosh market. is more Data ] GEN Sources