There’s a tremendous thread brewing on Neowin as a result of news that Microsoft is likely to produce a new Windows Live product version of Microsoft Works. The posting itself is fine but it’s the comments that are posted that are of more interest.
The comments range from “no way am I going to store my documents on a hosted service” through to “a free version of Works would be nice”.
Neowin does say that Microsoft should stop its knee-jerk reactions to the likes of Google offering Writely and Spreadsheet. However the fact that they did let the whole web browser thing slide away from them is obvioudly playing on the minds in Redmond.
How would a web-based series of basic Office products help Microsoft defend the desktop turf? Regardless of the fact that Windows contributes less and less to Microsoft’s overall revenues it’s still a huge slice of the money the company makes. OEM deals still rake in the money for Microsoft. If you’re not getting lock in through providing desktop delivered applications then anyone running Linux, Mac OS or a web browsing device of some description can access your apps.
Microsoft do have enough cash reserves to try this as a loss leader. It’s well publicised that Microsoft make a loss on the sale of Xbox 360 and that the real revenues are targeted at coming from the Intellectual Property of the platform as a whole and the Xbox Live services provided. If “Live Works” is the loss leader (although not necessarily if properly salted with advertising revenues) then this could be the precursor to a pay-for model for the Office Suite in the future. Microsoft continue to struggle with license revenues that they’ve not been able to reap because of pirated software. If the only way you can get software is from a service on the Web then this helps Microsoft’s cause. Certainly the problem will still be one of connectivity, as with all browser delivered applications, which is still not as ubiquitous as we as consumers would like.