Missing an Opportunity

Recently at our home, we purchased a new laptop, which came with Vista on it. Sadly, it didn’t come with Microsoft Office on it, and I was not able to open any word docs, excel, or powerpoints. I asked the store how much it would cost to add office, and they suggested in was $175. This seemed like a lot of money for a software system that I’m used to seeing as a base line image on most computers.

As a result (and being web savvy, of sorts) I started to use Google Docs, an online, ‘free’ version of office. Google offers an online spreadsheet tool, as well as an online document word processing tool, all with collaborative features that I could share with others.

As I continued to use these Google docs, I started to infect others, evangelism runs within my veins, and soon my wife started to use it, and I used it for a variety of documents within my new employer. I’m not sure if it’s becuase of me, but other colleagues in my team are using Google Docs for team collaboration. It’s not just Google either, Zoho is coming around the bend quickly, and had quite a presence at the recent Office 2.0 conference in SF that attendees were wondering why Microsoft was not present.

I wonder if Microsoft is missing a major opportunity here by: 1) Not providing these basic tools on the OS that buyers are not willing to purchase and 2) Not being agile to see how information is moving to the cloud and thus offering tools for the online office. When I do a google search for Microsoft online office, it results in thanksgiving colored templates.

Talking to Rafe of Webware (they believe in the web as a platform) he mentioned to me that the internet has made boxed software irrelevant, as users can now download them from the web, or use web versions of products.

What other software companies are missing an opportunity because of the web?

  • Nice thoughts 🙂

    I think it could be a killer move from Microsoft whenever it does happen. For an IT-worker it could be terrific to switch on between offline/online office apps.

    That apart, I also look towards it from the comparison of web-based application v/s desktop application with both having their own +ves/-ves :).

    First thing is the price like you said it is difficult to beat the price of something like Google docs any-day $175 is expensive for sure. Although it is terrific for collaboration, Google docs misses out on flexibility of shortcuts, additional options in the file menu and stuff like that.

    Assuming Microsoft does come out with an online version, there would be a user-tendency to compare it with its desktop office version. Is that gonna be free?

  • Online office apps are great for everyday notes, but they’re also:
    a. Much slower to work with, esp. for large docs.
    b. Missing advanced features (which you don’t realize until you need them, but I guess that’s only relevant for power-users who even realize these features exist).
    c. Indexed by Google, so I wouldn’t put sensitive information in them.

    I had the same problem as you recently (new PC, not wanting to shell out those $175 for MS), so I installed OpenOffice (openoffice.org). It can do almost everything that MS-Office can, can read and write MS-Office docs, the UI is almost similar so it’s very easy to make the transition, and it’s free…

  • Daan Jansonius

    I don’t think Microsoft are missing out on an opportunity, or at least not the one you presented.

    They recently had to stump up a whole lot of cash (Half a billion $$$ if I recall correctly) because they pre-installed Windows Media Player with their Windows software, which was deemed to be anti competitive by the European commision. I doubt the commission would approve of providing Office for free in a similar manner.

    I agree they will have to look for new opportunities to compete with the likes of Google and Zoho though.

  • They got sued and lost a lot of money for killing Netscape by throwing IE onto their OS, you want them to throw a basic office suite on their too?

  • Microsoft will never do something like this…internet is not you (web savvy), but a 90% less savvy that put a lot of time to pass on google docs (or other on line office suit)…

  • I agree with Stefan and Daan, a move like that would be seen as anti-competitive. So while it is a great feature (bundling), what are the odds of you then installing Open Office if you already have MS pre-installed?

  • I think what would make more sense is for microsoft to have their version of google docs, like the way microsoft live seems to be going, and then make their online office suite better than google docs. This way they would get around the whole monopoly issue.

    I do have to say though that I was quite pissed when my trial version of Office 2007 ran out on my new sony vaio laptop and I was asked to fork over 200+ USD to get the full version. Now I am pushing google docs to colleagues at work and random hobos on the street as well.

    Office 2007 is amazing compared to 2003. Powerpoint, Excel, and Word are all more ‘apple’like’ in the GUI and just general functionality. If Microsoft set the price for Office 2007 at 99 USD, then it would sell like hotcakes.

  • This is part of a much larger discussion about SoaS and the future of distributive tools.

    MS Office is now — by definition — a commodity product, considering robust, enterprise-level alternatives are available free (or effectively free, as a cost comparison).

    Forget the Western market for a minute; is it reasonable to expect those emerging economies — I’m thinking Eastern Europe, the Asian Subcontinent and Africa — to pay for individual software licenses? Nice idea but (sadly) naive.

    Office is dead as a long-term profit driver — as evidence from your experience noted above, Jeremiah — so Microsoft will need to figure out the next cash cow.

    MS doesn’t need to ‘bundle’ Office on Windows; just include a desktop icon as a link to an online (aka Windows Live) version of it.
    This will a) avoid anti-trust issues; b) provide value and service to the customer; and c) allow for a seamless migration to an web-based tool bearing a familiar and comforting brand name.

    Then we can have a discussion about which features should be free — I would argue for ‘most’ — and which should be designated premium.

    I stopped buying MS products in 2003 and happily use OpenOffice and Google Docs. I can’t justify the expense and I suspect I’m not the only one.

  • the last time they tried to put something in “as a default” they got sued big time — remember the whole IE and Netscape fiasco?

    Don’t be so quick to dismiss Office 2007 though — it is a really good software. However, I agree with you that it may be more cost effective for a home user to use OpenOffice and Google Docs.

  • José Luis

    I’ve been using google docs for atmost a year now. I have to say that it works quite well, yet, i really never tried a “profesional looking” document (like a PDF out of the entered text). I’m not sure the output is whay you would expect.
    The collaboration features on the other hand, are the most anoying thing ever (try having 3 humans updating the same document and you will see your screen/text changed/moved, and your “focus” gone).

    Anyway, regarding the MS strategy, i’ve read on techdirt or techcrunch about an interview with one of MS executives saying something like “people want desktop apps, not web apps” because of the “experience” or something like that.
    I wasn’t able to find that article, but i’ve found this instead:

    http://techdirt.com/articles/20070731/071554.shtml

    This may begin to explain what are they thinking.

    I have the growing idea that in five years, MS will probably be changing to become more of a content company (MSNBC, MSN/Live, etc) than a software company. Leveraging their installed base or having a reason to buy ther soft.

    At some point, linux and web apps will start becoming more popular and the cost of making, distributing, supporting software will just be unafordable. See http://www.techcrunch.com/2007/11/04/gos-where-computers-are-headed/

    But… maybe i’m wrong 🙂

  • Daan Jansonius

    Adobe have recently announced that basic parts of their photoshop software will become freely available on the web. For more advanced options you’ll have to buy the whole package. I can see Microsoft heading in a similar direction.

    Re David, I think Microsoft have realised that they need a new revenue stream a while ago and which is why they have gone into online and search advertising…

  • That’s fascinating! Has Forrester officially told employees that it’s okay with company documents – and potentially sensitive information – being stored online at a third-party site? If so, can you share what kind of evaluation was done before that policy was enacted? How do you reassure clients that you’re keeping their confidential data safe? I am intrigued!

  • Wade

    It’s just my personal scheduling, team updates –non-sensitive, and non-client. The same argument and scrutiny is on social networks.

    Lastly, we cover (as Analysts) the Enterprise 2.0 space (online document sharing and collaboration) so it’s somewhat expected we experiment with said tools yeah?

  • I gave a presentation last week through Google Docs, and in the day or so before the presentation, I invited everyone to come edit my slides. From that experience, and the crispness in the presentation itself, I think I’ve turned on a couple people to Google Docs.

  • Ross Popoff-Walker

    Sounds like the real problem is not their price point, not their overall strategy. If it was $25, there wouldn’t be a question of anti-trust yadda yadda, and consumers would pay for it.

    Honestly, how much money does MS make from selling boxed versions of office anyway? Why could it possibly have to cost $175?

  • I agree with Ross.
    The student version for MS Office 2007 is $25 – on a disk even.

    Google doc’s are ok, but be careful with the spreadsheets. I’ve lost info quick & changes aren’t tracked…

  • I had the same issue and downloaded openoffice. In retrospective I would have used Google docs. Of course I have some good news about microsoft. My Company has a deal with a Home use license for MS office so as long as I am a employee I can use MS Office and it cost me only $20.

    I think thats very nice of MicroSoft.

  • Daan Jansonius

    I don't think Microsoft are missing out on an opportunity, or at least not the one you presented.

    They recently had to stump up a whole lot of cash (Half a billion $$$ if I recall correctly) because they pre-installed Windows Media Player with their Windows software, which was deemed to be anti competitive by the European commision. I doubt the commission would approve of providing Office for free in a similar manner.

    I agree they will have to look for new opportunities to compete with the likes of Google and Zoho though.