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updated 6/29/2006 5:08:13 PM ET 2006-06-29T21:08:13

Microsoft Corp. said Thursday it would delay the release of its Office business software suite, citing "product performance" issues.

In a statement released by the company's Waggener Edstrom public relations firm, Microsoft said it would now release the product to big business customers by the end of the year, instead of in October as planned.

(MSNBC.com is a joint venture of Microsoft and NBC News.)

Consumers and other business users are now scheduled to get the product in early 2007. Microsoft had previously said it would be broadly available in January, to coincide with the delayed release of Microsoft's Windows Vista computer operating system.

"Feedback on quality and performance will ultimately determine the exact dates," the company said in the statement.

Microsoft has made early versions, or betas, of Office 2007 available for technical experts to download and test. In the statement, Redmond-based Microsoft said the delay was due to "internal testing and the beta 2 feedback around product performance."

The company declined to comment further.

The release of the next version of Office, which includes popular programs like Outlook, Excel and Word, is important for Microsoft because, despite its expansion into myriad other fields, the company still depends on Office and Windows for the bulk of its profits.

But Microsoft faces a tough challenge in convincing users to upgrade from previous versions of Office, which may seem just fine to many users. The company also is hoping to sell users on a slew of other related products for things like note-taking and advanced communications, as a way to grow revenue amid a more saturated market for the traditional Office software.

The new version of Windows, called Vista, also has faced a number of delays. It is currently scheduled to be released in January, missing the all-important holiday season.

Microsoft shares were up 21 cents, or less than 1 percent, to $23.37 in afternoon trading Thursday on the Nasdaq Stock Market.

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