Microsoft Corporation (NASDAQ:MSFT) has been causing groans of disbelief across the internet today as it announced the release of its Office 365, a cloud based office suite. The problem with the release has been pointed out several times today; the release came nearly seven years too late, and the product costs far too much.
The product that Office 365 directly competes with is an offering from Google Inc (NASDAQ:GOOG). Google’s Docs application is free to use, and it was released in 2006. Microsoft Corporation (NASDAQ:MSFT) may have impressed some people with its latest offerings, but today’s release was laughable.
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The Microsoft offering is infinitely more expensive than Google’s, though it may gain some traction in enterprise that are more used to Microsoft’s products and unwilling to change. The software will be available on Windows PCs and Macs, and on Windows tablets, but there was no announcement of a version for Google Android or Apple Inc. (NASDAQ:AAPL) devices.
The $99 dollar price tag isn’t a one off payment either, users will have to pay that $99 fee every year in order to have access to the service. A reduced rate is available to students, and University staff. There will undoubtedly be reduced prices for enterprise users as well, though those were not announced by Microsoft Corporation (NASDAQ:MSFT) today.
Microsoft has previously stated that the software will be available on both the Android and the iOS platforms, but it is unclear when that support might arrive. Microsoft may be attempting to boost sales of its hardware offerings by delaying release of its Office software on competitors’ platforms.
Microsoft traded up by a fraction today, mimicking trading for most days so far in 2013. The release of Office 365 has been anticipate for a long time, and its arrival has done little to sway the market’s view of the technology giant. Microsoft shares are up a little over 4% for 2013 so far.
The release, so late in the game, of a competitor to Docs from Google Inc. (NASDAQ:GOOG) points to the problems endemic in the company for so long. Microsoft’s massive size made it a slow moving giant, happy to rely on license fees from old products. It stayed like that for fifteen years, before the rise of mobile computing surprised the company and began to shake its bottom line.
Microsoft Corporation has spent the last twelve months trying to cleanse itself of that image. The release of Windows 8, and devices running the operating system, was supposed to completely change the company’s image. Despite that product’s release last October, the company is still far behind competitors.
The release of Office 365 might point to a key strategy for Microsoft Corporation (NASDAQ:MSFT) going forward. Enterprise climates are often slow to change, because of the training costs involved in moves to new systems. Microsoft may see license fees coming from companies too slow to move to Google Docs for free.