Microsoft on Thursday officially announced Office for iPad, which is now available. It’s technically free if you just want to open and read documents, but otherwise you’ll need an Office 365 subscription to actually create and edit. Office 365 starts at about $5 per user, or $60 a year, for small businesses, and $8 a user per month for the Office 365 Enterprise E1 suite. Office 365 Personal is $69.99 a year, or $6.99 a month. Did Microsoft wait too long and did it botch the pricing? I think so.
The problem isn’t at all with what you can do with Office, it’s the way Microsoft released it and when. It seems robust enough and the pricing is good if you’re already a subscriber to Office 365 (read: free). The problem, however, is that anyone who has had an iPad for the past several years has already found another way to live without Office. I have a hard time believing there’s a large user base of iPad owners who don’t already have Office 365 and, now that Office is available for the iPad, are suddenly moved to sign up for a subscription.
I’m probably a good example of that type of person. Sure, I like the idea of editing Word documents on the go – the thing is, I don’t even use Word anymore. I do all of my writing in Google Docs, which is free and already accessible from all of my devices. That’s just me, though. iWork is a free alternative for iOS and Mac owners, and already does a great job as an Office alternative.
Microsoft is missing a potential revenue source here, I think. Maybe, just maybe, I’d cough up a few bucks for Office for iPad and use it here and there. If it worked really well, I might be tempted to actually sign up for Office 365 and pay a subscription fee, so that I had a full suite on my computers too. Microsoft could have offered mobile users a taste of the suite and then led them into a more expensive all-encompassing subscription, possibly away from iWork.
The problem is, Microsoft is constricted by its own unwillingness to give Apple money. Any Office for iPad sales direct through the iTunes store would require Microsoft to give Apple 30 percent of the cut under Cupertino’s developer revenue sharing guidelines. In-app purchases fall under the same rules, but it’s probably more likely someone is downloading Office 365 on an iPad or iPhone after signing up for the service, versus signing up for it from the app itself – and so I bet that’s not as big of a worry.
I suppose it comes down to where Microsoft is choosing to lose some of its money. It could offer Office for iPad for a few bucks and possibly attract people like me, who aren’t going to sign up for Office 365 just to use it on an iPad, but then it has to pay Apple a cut of that revenue. Or, it can do what it’s doing now, by requiring a subscription, and lose the potential revenue from folks like me. As it stands now, it’s just a late but beneficial add-on for Office 365 users and that’s kind of unfortunate — at least for anyone who thought this could have been a growth opportunity.