Microsoft Plans to Profit from Piracy with Office Web Apps

By  |  Tuesday, March 3, 2009 at 6:30 pm

After countless attempts at suffocating software piracy, Microsoft has accepted it as an inevitability–one that it can profit from. The company intends to deliver an ad-supported edition of Office 14 in an attempt to draw illicit users into its revenue steams, Silicon Alley Insider is reporting.

That is not to say that Microsoft has abandoned the fight–it’s just thinking outside of the box. Today, at the Morgan Stanley Technology conference, Microsoft Business Division president Stephen Elop told attendees that an ad-supported version of Office could provide Microsoft with an eventual upsell opportunity with pirate “customers.” It would also diversify its revenue streams, he said.

Over the past two years, Microsoft has pushed ahead with its Office Genuine Advantage (OGA) program. OGA requires customers to validate their licenses in order to receive updates and add-ons. The program met with resistance from some customers when their paid software was flagged.

Those measures, while helpful, have apparently fallen short. Last month, Microsoft CEO Steve Ballmer told Wall Street analysts that piracy drained Office sales more so than competition from Google Apps, OpenOffice.org, or any of its other competitors.

โ€œWe offer services through Office Live today that take advantage of both ad-funded and subscription offerings. As we announced last year at PDC, we will deliver Office Web applications, which will be available with the next version of Office, to consumers through this service. We have nothing more to share at this time,” a spokesperson said.

Microsoft has pushed the dial enough toward enforcement direction that a new direction is warranted–paying customers won’t accept more inconvenience and intrusion. I’m not certain that splattering a Web-based version of Office with ads is going to eliminate piracy altogether, but it will provide an alternative to unauthorized copying that could reduce its occurrence without markedly affecting Office license revenue.

 
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2 Comments For This Post

  1. Sicarius Says:

    http://arstechnica.com/microsoft/news/2009/03/relax-office-14-client-applications-will-not-have-ads.ars

  2. JustCallMeBen Says:

    I think this is great: at last you don’t have to pay 250 euro anymore to simply type out a letter in word.

    Because that is the true reason behind the massive piracy of Office: since it’s virtually a standard everyone needs it (I know there’s openoffice and free aternatives, but the general public doens’t know or want that), but the prices MS asks for office are WAY too high. Thus average Joe and your every-day housewife ends up using illegal copies of Office which they usually got from a friend of a friend ๐Ÿ™‚

    If MS would make it more affordable (With that I mean a standard suite with Word, Excel and Powerpoint for sub 100 euro/dollar) piracy of Office would drop with at least 60%. Another option is this: a free basic service, because most users only need the basic functions.

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