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Yesterday, the Federal Appeals Court ruled in what appears at first blush to be a shocking decision, that Microsoft must stop selling Word 2007 by January 11, 2010. But a closer look at the decision suggests that this isn't as big a deal as it first seems.

Sure, Microsoft has to pay Canadian developer i4i close to $300 million, but that's really chump change for a company that has tens of billions in cash reserves. Microsoft itself has tried to minimize the impact calling the disputed tool, "a little used feature." Regardless, it appears, this has no impact on product already sold and the disputed code has been removed from upcoming Office 2010, leaving Microsoft with little real damage.

Could Have Been Worse

One thing Microsoft did by appealing was buy itself some time to get past the current version of Word and remove the feature in dispute. It could still have a short-term affect on sales, but most people at this point would probably be holding off until Office 2010. Doesn't really make sense to buy Word 2007 in any quantity that would matter to Microsoft with 2010 just around the corner. It remains to be seen if this would affect larger OEM partners like Dell and HP, but Microsoft insists that the delay has bought them enough time to remove the feature from Word 2007, and they will meet the deadline to remove it. If that's the case, Microsoft has had to spend some money, but doesn't really seem to be hurt too badly by all this.

Is It Really as Minor as It Appears?

Microsoft's official statement tries to suggest that the XML editing feature doesn't matter much, and that's true if you're an average user or a consumer running Word at home, but for companies the XML feature in Word 2007 changed the game and allowed enterprise customers to embed code to use Word documents in complex work flows and to communicate and move documents across disparate business systems. For them, the feature matters a lot, but again, since the ruling has no impact on packages already sold, it shouldn't really matter to customers who have been using this product for years and have built connectors to external systems using XML code covered under this decision.

Makes Good Copy

It's hard to point to a single product beyond Windows that would have a huge impact on a company as large and diverse as Microsoft, but Word comes close because it's a tool so many people use on a daily basis. When you see a headline suggesting they have to stop selling it, it makes you stop and think. Main stream press outlets certainly have jumped on this and tried to make it more than it is.

In the end though, while this is probably embarrassing for Microsoft, it appears to be little more than a legal speed bump. Ultimately, there's nothing to see here folks. Let's move along.

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