Originally Posted by AppleInsider
The Office for Mac 2011 update is expected to ship early next year alongside the Windows-only Office 2013.
And what compelling reasons are there, if any, for Windows users to upgrade from Office 2011 to Office 2013?
Cloud integration? Really? Exactly how important is that to the majority of Office users? You know, the vast
middle of the bell curve who use Office "because everyone else does." I'm sure they can get by without it.
And is Office 2013 really worth the hundreds of $$$? MS hasn't released pricing info on the upgrade yet, but
Office 2010 Professional went for $350, and there was no discounted upgrade price for Office 2007 users.
Maybe Office 2011 is "good enough." Microsoft has made quite a lot of money shipping software that's
just "good enough."
I can think of two things that might happen if Microsoft doesn't ship Office 2013 for Mac:
1. Apple replaces Office with an equivalent Apple productivity suite
Apple must have been preparing for the day when Microsoft might drop Office for Mac support. And that day
is certainly coming soon. Microsoft could cut off Office for Mac support in an attempt to protect Windows sales if and
when Mac sales reach a tipping point. And Apple must have been waiting for any decent excuse to launch iWork Pro, or
whatever their Office replacement would be called. If Microsoft doesn't ship Office 2013 for Mac, it will be Apple's
cue to replace Office for Mac.
An Apple Office replacement could help Apple in other ways in the long run. For example, if and when Apple transitions
the MacBook Air to ARM-based CPUs, there would be one less third-party software vendor dragging their feet,
slowing down the transition. Apple waited 10 years for Adobe to port their pro apps to OS X. Never again Not
for an OS transition, not for a hardware transition.
Of course, there is a chance that Microsoft could port Office to ARM on their own. If they're serious about Windows RT
on ARM, they just might port Office 2013 to the ARM-based Surface. If they're not serious about ARM, they'll keep it
Surface Pro-only, and thus Intel-only. But you can bet that Apple isn't collectively losing any sleep waiting for Microsoft
to decide what to do.
OK, so let's say that Apple's Office replacement is successful. That it satisfies the majority of Mac ex-Office users.
Then what happens?
2. Microsoft is forced to drop the price of subsequent versions of Office
As we've all seen, Apple's App Store model for iOS and OS X has brought down the cost of software on iDevices
and on Macs. iOS has always been free, and OS X upgrades have gotten cheaper. OS X 10.8 Mountain Lion
will be a $20 upgrade when it is released this month. Most apps on iOS are just a few bucks. And even Mac
apps are far cheaper than they were before the Mac App Store. Apple has conditioned their users to expect
lower software prices.
And Apple is happy to sell OS X and its in-house apps fairly cheaply. Because they make their money on hardware.
The OS and apps are all value-add for the users of their hardware. This particular model is working very, very well for
Apple right now.
Fine. So how does this affect Microsoft? Well, Microsoft has announced that the Windows 8 upgrade will cost $40.
Even for the Pro edition. And how much did the Vista to Windows 7 upgrade cost? Windows 7 Home premium went for $49.
Windows 7 Professional went for $99. That's a pretty steep drop. Microsoft wouldn't do this if they didn't have to. It
certainly looks like Apple's low software pricing has forced Microsoft to lower their prices too.
Unfortunately for Microsoft, they need to make money on their software. Their Windows and Office businesses are their
bread and butter. Profits from those two products fund everything they do. Lowering prices may increase volume, but
that increase in volume may not compensate for the lower per-unit margins. And, once you've dropped your prices,
it's very hard to bring them back up again. Do the words "race to the bottom" ring a bell here?
Microsoft is stuck. They could very well ship Office 2013 for Mac any day now, but by doing so they would be
encouraging the success of a Windows PC competitor. And Mac sales have steadily increased in every quarter of the past
6+ years. The Windows market share is gradually eroding. Microsoft will be forced to stop that erosion in any way
they can, even if it means holding back or canceling Office for Mac. Not a major source of revenue for Microsoft,
but how else can they slow down Mac sales?
If Microsoft doesn't ship Office 2013 for Mac, Apple just might have a replacement ready and waiting. They've
had years to plan, design, develop, test, and iterate. And if Apple's Office replacement is good (and cheap),
Microsoft will lose the Office for Mac market forever.
Meanwhile, for whatever reason, Microsoft has been forced to drop upgrade pricing for Windows 8. The days of
nosebleed upgrade pricing are over. You only drop prices to gain market share if you're a newbie or to regain lost
market share if you need to. Times change.
Just my $0.02.