Microsoft has revealed pricing details for the up-coming launch of Office 2013 and Office 365 (see Microsoft unveils a more social Office and Microsoft bringing App Store concept to Office 2012). It is not the pricing levels that are important so much as its intention to go all out for subscriptions to cloud-based Office 365 in order to capture recurring revenue from the multi device user. The initial pricing details focus on the consumer offerings but enterprise details will follow.
Take an on premise licence to Office 2013 and you get a one device licence, take Office 365 and the subscription covers up to five devices. It also provides access to Office on Demand that allows temporary copies of Office to be streamed to PCs, making Office available to subscribers from any device they happen to be working on, plus SkyDrive and Skype. Two packages will be available - Office 365 Home Premium will cost $99.99 per year, with the more fully featured Office Small Business Premium coming in at $149.99 per year.
Microsoft is trying to hit a lot of bases with this licencing set up including boosting recurring revenue from the lucrative consumer market, attracting consumers with a view to further business pull through, and tackling the Google Apps threat head on. It is also emphasising its own multi platform capabilities and a unification strategy covering devices, operating systems and applications. Most importantly it pulls Office into the subscriptions arena which will be critical to its long term prospects and as Office is Microsoft’s biggest earner, to Microsoft’s fortunes.