Saturday, July 5th 2008
Microsoft to Offer Software on a Subscription Basis
Soon, among your usual utility bills of electricity, water, gas, telecom, could be a new addition, software. Microsoft has come up with a new subscription model, where instead of outright buying a license to use the software, consumers can subscribe to use it. A monthly or annual subscription charge has to be paid by the user (subscriber) to continue using the product.
This scheme for now covers products such as Microsoft Office and One Care security software. Analysts are already beginning to predict this will be Microsoft's next big business model which will fuel its growth in the years to come. There's much in store for both consumers and the company.
For the consumer it means value. Let's say I subscribe to Microsoft Office 2007 for this year at a charge of US $70, the next year, if Microsoft comes up with a new version of the software, say Office 2009, I can simply unsubscribe to this and switch over to that, a lot more convenient than if I were to buy a $350 copy of an Office 2007 variant at the store, and next year Microsoft comes up with the new version, I end up spending a lot more to be able to use that software.
For the company it means higher income, since each legitimate subscriber will have his own usage account and illegal copies of the software won't run since the user still needs a subscription account with Microsoft to even run the software or end up using the pirated product disc as paper-weight. While it's only limited to Office and One Care now, it wouldn't be too far-sighted to think other Microsoft products, even Windows for that matter, could come with subscription plans.With inputs from Newser
This scheme for now covers products such as Microsoft Office and One Care security software. Analysts are already beginning to predict this will be Microsoft's next big business model which will fuel its growth in the years to come. There's much in store for both consumers and the company.
For the consumer it means value. Let's say I subscribe to Microsoft Office 2007 for this year at a charge of US $70, the next year, if Microsoft comes up with a new version of the software, say Office 2009, I can simply unsubscribe to this and switch over to that, a lot more convenient than if I were to buy a $350 copy of an Office 2007 variant at the store, and next year Microsoft comes up with the new version, I end up spending a lot more to be able to use that software.
For the company it means higher income, since each legitimate subscriber will have his own usage account and illegal copies of the software won't run since the user still needs a subscription account with Microsoft to even run the software or end up using the pirated product disc as paper-weight. While it's only limited to Office and One Care now, it wouldn't be too far-sighted to think other Microsoft products, even Windows for that matter, could come with subscription plans.With inputs from Newser
27 Comments on Microsoft to Offer Software on a Subscription Basis
This would reduce piracy a lot, lessening the initial cost. I'd pay $10 a month (at most) for a windows licence that i could transfer when a new OS came out.
Joe
manofgod: thats a very valid point, i hadnt considered that.
oops, I know you want to chack email, oops, I know you want to pwn someone at WoW, oops, I know you want to show-off your e-pns at the forums, oops, I kno......but no pay, no connection.
^substitute 'connection' with < insert utility here >
although unless apple also switches to this method i dont see how thats going to be good for competition.
subscriptions dont end unless you stop using the software. paying 10bucks a month for the next few years as i use this OS doesnt exactly make me feel all that better off.
if its as tpu says and its for things like office, i can understand sorta. still it wont effect me.
or about 80% of this forum's users.
im really unfit to comment as i , speaking honestly, NEVER pay for anything other than my online smack addiction.
Also, Microsoft has been working to make many applications web-based for this same reason: you won't even have to have the software installed locally. Just browse to the web-location you need and the software is there for you.
There are two reasons for this. First, Microsoft got hurt by having six-seven years between XP and Vista. They spent a lot of money to get one OS rolling, and the initial release is where they see the highest volume of sales. (Just think of all those people standing in line to buy Windows 95 when it came out.) Whenever there is a big gap in time between the OS release dates, they don't have a lot of income coming in. Going to subscriptions makes sure that there is a regular paycheck coming in from everybody every month.
Second, going to a web-based set of applications allows the users to pay and access the software, without having to buy the disc. The disc, the manuals, the boxes, etc. all cost money. Less stuff for MS to produce means more money in their pocket.
Anyways, I've always been afraid of them doing this. The only way they could really pull this off with Windows would be if they got Apple to do the same thing with OSX. If people are having to pay monthly / yearly for Windows, but OSX is a one-time deal (although releases are much more common), what do you think people are going to do? It's either become a pirate, or switch.
Web based applications are all well and good, unless you're out in the sticks and stuck with dial-up.
She wants to help people and wants to make enough to pay her bills, but we actualy do better on taxes if her business take a loss. :D
If they do do this, it will probably be like what they do with Xbox Live. Pay monthly, every 3, 6, or a year. When you look at the figures, if you dont just flat out spend $50 for a year (and most times get a free month) your spending a lot more in the long run.
Unless they make these payments a lot smaller than they are now, I don't see many customers...
I, for one, will not ever pay for software on a subscription basis, especially if they do this with Windows itself (Office is a little more understandable, but still no). If that happens, I'll just pirate it.