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Word document opening as Read-Only from Internet

During our Windows 7 testing, we have a majority of systems that are opening a document from our online rating and proposal system as Read-Only.  For some of the systems, we have resolved this by setting Word to Compatibility Mode (Windows XP SP3), but most are still affected by this.  This has worked in IE 8, 9 & 10, so the source of the issue seems to lie with Word 2007.
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If I understand you, when I see this, pass word required and read only, I just click on read only no need to put a pass word .
Is this what you mean by read only.
Take a look at my screenshot of a word doc that has this
clicking on the read only opens it
 User generated imageIf your on windows 7 and use an older version of office like I have office 2003
and you need open a newer version of word there is a compatibility
patch available
How to install the Microsoft Office Compatibility Pack
When you say "opening as Read-Only from Internet", it's not really opening "from the Internet".  It has to first download the file to the Internet Explorer "Temporary Internet Files" cache and then Word opens it from there.  I don't have Office 2007 and therefore cannot test this, but I would guess that this is possibly intentional.  Is the user being shown a security dialog with a tick box before the file opens in Word, and if so what happens if the box is unticked before clicking the OK button.
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Thanks for your comments.  If this was intentional, it wouldn't be a problem.  I'm using Word 2007, so I would not require the Compatibility Pack.  I've attached a screenprint of what I'm referring to by the Read-Only dialogue.  On my system, I was able to resolve this by selecting Compatibilty Mode on the Properties box for WinWord.exe (see attached).  However, when this setting is applied to other systems (same image), it still opens in Read Only mode.  This is also occuring when opening other Word documents from the Internet (e.g. Word Calendar Template).
Sorry for the misunderstanding.  Rather than using the word "intentional" I should have said "by design".  What I was suggesting was that because the target file of a URL is being downloaded to Internet Explorer's "Temporary Internet Files" cache and then opened by Word from there, it is probably "by design" that it opens as Read-Only.  You wouldn't really want a user clicking the "Save" button and having Word save the file to that folder because that folder and sub-folders are usually hidden from users and have special attributes.  It clearly is a better idea that a user be forced into the "Save As" dialog so that it is saved to a non-system folder.

I only have XPSP3 and Word 2003 on the PC I am using, and the behaviour is exactly as I would have expected when clicking on a web link to a Word document in Internet Explorer (v8).  It first shows the security bar at the top telling me that IE has blocked the download of a potentially unsafe file.  I click on it and allow IE to download the file.  I am then prompted to "Open or Save" the file via a the standard security dialog.  I click "Open" and IE downloads the file to a sub-folder of:
"C:\Documents and Settings\Bill\Local Settings\Temporary Internet Files\Content.IE5"
as "OriginalFileName[1].doc", and Word then opens it from there.

There are two different ways that the file may be opened, depending on a registry setting.  It may open with Word inside the browser, showing fewer navigational buttons and with the IE menu items being replaced with Word's own OR it may open Word outwith the IE window where the Word window is shown normally.  The different behaviour is controlled by  the presence and actual data value of a "BrowserFlags" value in the registry under the particular file type, and can be changed from Folder Options > File Types > <file extension> > Advanced.  There is a tick box named "Browse In Place".  Ticked is the default, where the registry "BrowserFlags" value doesn't exist under that file type.  Unticked, it writes a DWord value named "BrowserFlags" and sets it to a hex/decimal value of 8 like this (for Word 2003):

Regardless of whether thedocument is opened with Word inside the IE window or as an external instance of Word, I get the behaviour that I expect, and that is to open the file as Read-Only from the browser cache.  I can edit it just fine, but if I click "Save" I will always be prompted to "Save As", and if I try to browse back to the cache folder where I know that the file exists, that folder and all sub-folders are hidden from me even with my explorer settings configured to show hidden and system files.

Of course these restrictions relate to a hyperlink to a Word document using the http:// protocol in the "Internet Zone" and not to the "Local Intranet" or "Trusted" zones where restrictions are less stringent.  There is also the issue of http:// vs file:// or ftp:// protocols, where behaviour may be quite different.

A Word document on a shared drive on a server that is opened from a hyperlink in a locally stored web page (ie. the file:/// protocol) will open the file from source and it will be editable and directly "saveable" again regardless of the "BrowserFlags" value.

Unfortunately I have to admit that I have no idea why the "XP Compatibility Mode" setting for Word should change the behaviour on your computer but not other computers, because as far as I was always aware this is expected behaviour.

Hopefully somebody using Windows 7 and Office 2007 will be along and can try to replicate or explain the different behaviour.
What stands out to me is the Word.doc and Winword.exe
changing the properties of winword I dare say would not apply to word, word is in office and WinWord is the windows inbuilt word.exe
Downloadable/open .doc set as a URL to open in the browser would have the prefix (doc) before it
Java script is required?
Can this from Microsft help you
Configure the document-to-Web page converters
Microsoft Office SharePoint Server 2007 includes document-to-Web page conversion utilities that can convert Microsoft Office Word 2007 documents (with and without macros), Microsoft Office InfoPath 2007 forms, and XML files into standard Web pages that can be published to an internal or external Web site.

When you configure the document-to-Web page converters, you specify the page layout, styles, Web page location, conversion templates, and more. After you configure these options, users can go to the site and convert documents into Web pages without having to know HTML or any of the conversion settings.
In this article
 Advantages of converting documents into Web pages
Considerations before you configure document-to-page converters
Configure the document-to-page converters
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