Microsoft Office 2013 Retail – There’s a Sucker Born Every Minute

(Originally posted April 27, 2013 on my Infrasupport website when I was an independent IT consultant. I copied here and back-dated to match the original posting date.)

I spent an awful day yesterday with Microsoft Office 2013 Home and Business Edition.  Full disclosure – my company is a Microsoft Registered Partner and this blog entry won’t make me any friends in Redmond.  But right now, I am frustrated beyond belief and I will have trouble sleeping until I put electronic pen to virtual paper.

After more than 20 years of Microsoft producing a product named Office, by now everyone knows what it includes – a spreadsheet named Excel, a word processing program named Word, an email client named Outlook, a presentation package named Powerpoint, a personal database product named Access, and a desktop publishing program named Publisher.  Different editions of Office include different combinations of packages and licensing and Microsoft mixes them up with each new version.  By now, Office is the de-facto standard for electronic document formats.

With Office 2013, Microsoft combined the audacity that comes with monopoly power with technological incompetence.  What possible rational reason could anyone give to force customers to create a unique login on the Microsoft website for every single retail copy of Office Home and Business?  If you own, say, 50 computers and you have 50 copies of Office Home and Business, you need 50 Microsoft logins to make it work.

Sheer insanity.  Or is it?  Microsoft is filled with competent engineers and savvy marketers.  Microsoft did this for a reason, and this is really a story about a 21st century shakedown scheme.  But it’s buried underneath a pile of technical jargon so very few will notice.

With Office 2013, Microsoft offers three licensing choices, called Volume licensing, retail licensing, and a subscription service named Office 365.  Office 365 is new, the rest have been around a long time.

Volume licenses come with lots of flexibility businesses care about.  Companies can deploy volume licenses any way they see fit.  A volume license for Microsoft Office Standard edition includes only Word, Excel, and Outlook and lists for roughly $370.  Microsoft Office Professional Plus includes all the Office packages and lists for roughly $500 per seat.

Retail licenses cost less, but are less flexible.  For example, Office Home and Business includes Excel, Outlook, Powerpoint, and Word – more packages than Office Standard, but with a lower price of around $220.  The Home and Business license is only good for one computer.  Once installed on any computer, that license is married to that computer forever.  If your PC dies and you need to reinstall Office Home and Business, you need permission from Microsoft.

So far, so good.  Here comes the audacious part.

Starting with Office 2013, Microsoft purposely made Office Home and Business a nightmare to install by adding an artificial impediment.  Microsoft now requires a unique login on its website for every single individual copy of Office 2013 Home and Business.  For each individual login, you must specify the name, phone number, address, email address, and other identifying information.  After setting up this login, you can download and install your individually tailored copy of Office 2013 Home and Business.  The download is roughly 2.2 gigabytes. Customers who use T1 Internet connections will need almost 4 hours per download and each installation now requires its own download. 50 installations means 50 downloads.

If anything goes wrong – a network hiccup during the download, a wrong answer to a question, anything – you’ll spend hours fiddling with registry entries and deleting files by hand because it won’t remove cleanly. I had 4 identical brand new computers and spent most of a day cleaning the remnants of a botched installation on one, with lots of telephone advice from Microsoft Customer Support about undocumented registry entries.

And finally comes the new offering, Office 365.  It’s a Microsoft hosted solution, meaning you connect to a website and work on your documents from there.  The cost is $99 per year or around $10 per month.   No installation hassles, quick and easy to set up, no up-front financial pain for end users.  Your documents live inside a Microsoft cloud, so they are accessible globally and you don’t need a server anymore. Naïve CFOs and Purchasing Departments will love it.

P. T. Barnum reportedly once said ”there’s a sucker born every minute” and he may be laughing in his grave at this modern massive con job. Why would Microsoft price its hosted offering so low relative to a locally installed copy of Office?  Why would Microsoft take such apparently boneheaded steps to artifically complicate installations of Office Home and Business?  And why would Microsoft spend $millions for the cloud capacity to store and manage millions and millions of new user accounts?

Only one answer makes sense – increased revenue.   How does spending $millions to host all this stuff generate revenue?

I can think of only one answer – and I promise, you won’t like it.  Microsoft wants to be the repository for all your personal and business content.  Office 365 will capture your documents, Outlook.com will capture your email, Lync will capture your video meetings.  If Microsoft can make your installation experience expensive and miserable when installing on your own computer, and make it hassle free and low cost when hosting in its cloud, many people will opt for the path of least resistance and put their documents in the Microsoft cloud.  Millions of Office 365 users will blindly trust Microsoft with their most private data because getting started is cheap and easy.

Once Microsoft captures all your content, marketers will pay Microsoft a holy fortune to slice, dice, and analyze your content.  You will provide raw material for marketers and you will pay Microsoft for the privilege.   But marketers will pay much more.  Marketing will be the real Microsoft revenue source – your $99 per year subscription is just a few giblets on the real gravy train.

What to do about it?  If you don’t care if an army of marketers digs deep into your content, trust Microsoft.  If you do care about privacy, maybe now is the time to start looking at alternatives.  Several are available, including Libre Office and other free and minimal cost offerings.  If enough people start adopting some of today’s great alternatives, maybe Microsoft’s monopoly power can be tamed.  But if history is a good predictor, this probably won’t happen.

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