Without adding any special software to Office, users will be able to open documents sent to them in the open source Open Document Format (ODF), the company said. As well, users will be able to edit and save documents in that format.
"Microsoft is going to be providing support for three new file formats directly in the Office product," said Erich Anderson, vice president and general counsel for Europe, in a telephone interview.
In addition to ODF, Microsoft will also support Adobe's popular PDF fixed format and Microsoft's competitor to PDF, known as XPS.
Microsoft offers support for ODF in its current version of Office but only if additional software is downloaded separately and installed.
The company did not address concerns expressed earlier this month by a British government agency, BECTA, that Microsoft's existing ODF software does not work very well.
BECTA has complained to competition authorities in London and Brussels that the ODF "translator software" has limited functionality and is poorly integrated, compared with Microsoft's own products.
The European Commission responded cautiously to Microsoft's statement.
"The Commission would welcome any step that Microsoft took towards genuine interoperability, more consumer choice and less vendor lock-in," it said.
The Commission added that it will look into whether Microsoft's announcement "leads to better interoperability and allows consumers to process and exchange their documents with the software product of their choice."
The Commission has fined Microsoft 1.68 billion euros since 2004, in large part for the company's failure to provide proper interoperability between its dominant Windows operating system and other software.
Microsoft has appealed against part of that, an 899 million euro fine imposed in February for its failure to co-operate. The company has said it will now cooperate with the Commission.
Microsoft said it will add support for ODF version 1.1 when it updates its Office 2007 product some time next year with "service pack 2."
The company said it would also join a technical committee that is discussing a newer version of ODF. It did not say how long it would support ODF or whether it would support successive versions of ODF.
Thomas Vinje in Brussels, a lawyer who has represented clients opposed to Microsoft, said the announcement was meaningless unless Microsoft made ODF the default standard when people opened office.
If ODF is not the standard its presence "won't matter because the vast majority will not use it. That was the experience in the U.S. case," he said, referring to a case which found Microsoft in violation of the Sherman antitrust act.
Carlo Piana, a lawyer in Milan who represents clients who make open source software, called Microsoft's approach "too little, too late."
He said that Microsoft should meld its own standards with ODF. Microsoft's own standards were recently adopted by the International Standards Organisation (ISO) as an alternative to ODF. The Microsoft standard is called OOXML.
(Reporting by David Lawsky, editing by Gerald E. McCormick, Richard Chang)
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