Microsoft invests $500m in Vista upgrade push

Microsoft is to invest $500m in a campaign to poach customers from IBM and convince businesses of the value in upgrading to Windows Vista and Office 2007.

Microsoft CEO Steve Ballmer, speaking at a conference in New York City, said the marketing and sales campaign will be aimed at communicating the "value proposition" of the company's software for businesses.

Ballmer outlined some of the features in forthcoming releases of Windows Vista, Microsoft Office, Windows Mobile and Microsoft Exchange Server as part of what the company is calling the "people ready" vision for helping businesses encourage their staff to use the full capabilities of the software they buy.

Ballmer said: "It's really only Microsoft software that I think we can fairly say supports people, from the human interface, into the data centre and on into the internet. There are other companies that will support people one of those places, or maybe two, but I think it's very important, and quite unique, that we can do software that links that together."

Outlining better integration between Office and Microsoft's other products, Ballmer said forthcoming software releases will help business with collaboration, enterprise search, the mobile workforce, business intelligence, customer relationship management and infrastructure.

Ballmer said that for most business customers it comes down to a choice between Microsoft and its main competitor IBM.

He said: "We're staking out a position quite different than our leading competitor. We are talking about making the people in the business more productive. IBM increasingly is a services company. At the end of the day, we're a software company."

Fashion designer Tommy Hilfiger and his company's CIO were also wheeled onstage at the Microsoft event but Ballmer - bedecked in a red, blue and white Hilfiger tie - admitted, "I am not a generally fashionable guy".

Ballmer said: "I have the Tommy Hilfiger tie on, and I thought that looked good, and I was all excited, I went and shook hands with Tommy, and the first thing he pointed out to me was I didn't have my collar buttoned down properly... I'm still working on the fashionable side of life."

No-one from IBM was available for comment.