Analyst firm NPD Group says sales of Office 2010 have been disappointing to date. Yes, sales so far are roughly in line with those of Office 2007 right now, but it’s selling more slowly than Office 2007 did at launch three years ago. This doesn’t bode well for the company, which stakes a huge part of its operations on selling the expensive, industry-standard Office suite — Office 2007 earned $1.5 billion in sales — and which has everything to lose if Office loses that industry-standard status.
Why the softness in sales? In a nutshell, NPD says everyone who wants Office already has it, and those who don’t aren’t going to upgrade for any price.
Microsoft finds itself in a bit of a predicament with Office 2010. The market for productivity software is saturated to an extreme, and Office 2010 just doesn’t offer enough in the way of new features to merit an upgrade for most users. It’s expensive, and corporate users are unlikely to make a fuss if their IT departments hold off on the upgrade, possibly even sitting out this version altogether.
Meanwhile, Office is being squeezed on the low end by the growing popularity of free online productivity suites like Google Docs, which offer 90 percent of the functionality of Office at zero percent of the price. There is nothing but upside ahead for online office suites as they become more and more capable, and though they haven’t hit the mainstream quite yet, it’s only a matter of time before they do. Microsoft’s attempts to build “cloud” features into Office just don’t cut it.
What about you? Are you using Office 2010? Do you even care?
— Christopher Null is a technology writer for Yahoo! News.
