A Microsoft Office logo is shown on display at a Microsoft retail store in San Diego in this file photo from January 18, 2012. REUTERS/Mike Blake
As more tech giants attempt to reinvent themselves as trusted cloud providers, Microsoft’s latest Office suite is the most recent addition to the burgeoning consumer cloud lineup. The biggest divergence between the traditional Office suite and the cloud-based version released on January 29 is the buying-versus-renting option.
The new Office 365 Home Premium – the first major overhaul of the Office franchise in three years – includes the latest set of Office applications, works across up to five devices (including Windows tablets, PCs and Macs), and comes with extra SkyDrive storage and Skype calling. The cloud-based service is priced at $99.99 for an annual subscription, marking the first time Microsoft’s Office suite programs will be available through a subscription model. And the company is pushing this model. Access to most apps from the Office suite costs $8.34 per month, so the more PCs subscribed, the better the price tag looks. (A single installation purchase of Microsoft Office is $140.)
Microsoft CEO Steve Ballmer emphasized that this is the first time users can subscribe to Office instead of purchasing the software for installation, and he pointed out the new cloud and social features in a public statement:
“[The] launch of Office 365 Home Premium marks the next big step in Microsoft’s transformation to a devices and services business. This is so much more than just another release of Office. This is Office reinvented as a consumer cloud service with all the full-featured Office applications people know and love, together with impressive new cloud and social benefits.”
The cloud storage component is an aspect Microsoft is banking on to keep its Office product sustainable. While Microsoft has been working to get Office 2013 right, competitors such as Dropbox and Box have forged ahead, snatching up literally tens of millions of users. Office 365 includes an additional 20 GB of SkyDrive cloud storage (nearly three times the amount available with a free SkyDrive account) as well as 60 free Skype world calling minutes per month to call mobile phones, landlines or PCs.
The transition from a packaged software business to a productivity service is a big leap for the tech giant, which will start leveraging its $1.2 billion acquisition of Yammer, tying Office into the a private social network for a company’s employees. As Ballmer summarized: “Transforming from a software-maker to a devices and services company requires us to make big, bold bets and push our business in new directions.”
