Who needs a cloud? Microsoft sold 31 million copies of Office 2010

Microsoft is taking aim at some unspecified critics on the one-year anniversary of Office 2010, saying the product has sold a copy every second despite the rise of Google Apps and other cloud-based alternatives.

"When we released Office 2010 to the world one year ago [on June 15], our critics weren't easy on us," Microsoft Office corporate vice president Takeshi Numoto writes in a triumphant blog post that was to be published on the Microsoft website Wednesday. "They said we were heading in the wrong direction by continuing to invest in our desktop applications in addition to the cloud. Even more recently, there've been more predictions of the PC's demise. But the reality is, based on the market results we see in our sales and adoption data, people continue to love Office on the desktop and they're embracing Office in the cloud."

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Numoto goes on to write that "Business customers are deploying Office 2010 five times faster than they deployed Office 2007 [and] Office 2010 is also the fastest-selling consumer version of Office ever."

In a phone interview Tuesday, Numoto further said "since the launch of Office 2010 we've been selling a copy of Office every second."

We'll do the math for you: that's about 31.5 million copies. The number could be higher, assuming Microsoft is counting only Office 2010 sales and not Office for Mac 2011, which came out late last year.

Microsoft's biggest cash haul comes from licenses for packaged software, but it's hedging its bets with Office Web Apps, a cloud-based service that competes against Google Docs in the Internet-only productivity arena.

The free Office Web Apps, which includes Word, PowerPoint, Excel and OneNote, also launched a year ago and now has 50 million unique monthly visitors, Numoto says. "We're seeing great growth and usage," he says.

Google Docs, by the way, has "tens of millions of active users," meaning people who have used the service within the last seven days, a Google spokesperson tells us.

Office rivalry: Google Apps vs. Microsoft Office

Also see: The 10 bloodiest battles Microsoft and Google fought in 2010

Despite the presence of Office Web Apps, Microsoft would prefer customers buy the more robust packaged Office software, which costs $150 to $500 depending on the version, with business customers buying in bulk getting a better deal.

But a fee-based business version of Office Web Apps will be rolled out later this month as part of the Office 365 cloud service, which also includes Exchange, SharePoint and Lync Online.

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Microsoft says it doesn't disclose actual sales numbers for Office 2010, even though the one-copy-per-second figure gives you a rough idea. Microsoft does, however, say that all versions of Office combined is used by 750 million people worldwide and that Office is installed on 1 billion personal computers, not including Macs and smartphones - Windows desktops and laptops only, in other words.

If 31.5 million copies per year is a high water mark for a current version of Office, it's hard to figure how there could be 750 million active users. A Microsoft spokesperson declined to explain how the company calculates the figure.

Parsing Numoto's statement that Office 2010 is being purchased by businesses faster than Office 2007, and that it is the fastest selling consumer version of Office ever, it's still possible that it's not the best selling version of Office when business and consumers are counted together.

However those numbers add up, Office has become a de facto standard in business and home computing because of its rampant success. One of Microsoft's main criticisms of Google Docs is that Office documents imported into the Google service lose some of their formatting - an argument made possible by Redmond's near monopoly position.

But there are limitations with Microsoft Office's Web versions and their ability to work across desktop and mobile operating systems. Although Microsoft has Office for Mac, and a mobile version for Windows phones, it hasn't built client applications for Android, iPhones or iPads. OneNote, Microsoft's note-taking software, is not available in Office for Mac, nor is it available on Android or the iPad (not counting an iPhone version that can be blown up to the larger screen of the iPad but with poor visual quality).

Both Microsoft and Google let multiple users edit documents simultaneously, but on the Microsoft side the browser-based co-authoring is limited to Excel and OneNote. Co-authoring in Microsoft Word and PowerPoint requires the "rich client" and can't be done in the browser.

In addition to selling its own computers called Chromebooks, Google will be adding offline support for Google Docs in the Chrome browser this summer, and offers various tools that either add collaboration capabilities to Microsoft Office or move users from Microsoft products to Google ones entirely. Google also ensures a little peace of mind by automatically saving documents after every keystroke.

Numoto said he has nothing to announce about Office expanding to new devices or adding more Web-based capabilities. But he said the mobile browser version of Office Web Apps, while it doesn't include all the functionality of Office on Windows phones, does give smartphone and tablet users access to their documents.

"The way we developed Web Apps is designed to give us a tremendous amount of reach, with a focus on using Internet standards like CSS, HTML and JavaScript," he said. Still, he said the Office app for Windows phones has some extra features, like the ability to comment on documents.

There are other limitations: "Viewing Excel files via a mobile browser is currently only available with Office Web Apps on SharePoint 2010," Microsoft says on its website. Further, Microsoft says it offers mobile browser support for BlackBerrys, Nokias and iPhones, but fails to mention Google's Android, perhaps the most widely used smartphone platform.

Microsoft has consistently described the Office Web Apps as a complement to the rich client, for light editing only, rather than as a replacement that can be used for creating documents.

Numoto insisted that's not because of limitations in the browser versions but because "it's more what we see customers doing. . . . You can create new documents purely on Web Apps, but what we see customers doing is taking the best of both worlds."

Another possibility: People only use the technology that way because they realize the browser-based versions aren't as good as the one installed directly onto their desktops.

While Microsoft will have to upgrade the browser-based versions of its Office applications to keep pace with Google, it may be reluctant to do anything that cuts into sales of the lucrative offline versions of Office.

Google Apps doesn't take in the kind of revenue that Microsoft Office does, but Google does have the advantage of a simpler message: it's all in the browser. Then again, many people don't want to do all their work in a browser, and Microsoft Office files can be shared and made portable across devices rather easily with Windows Live SkyDrive or non-Microsoft services like Dropbox, which has browser-based access as well as clients for Windows, Macs, Androids, iPhones and iPads.

With options for businesses and consumers expanding along with the reach of the Internet, the Office wars are sure to get a lot more interesting over the next year.

Follow Jon Brodkin on Twitter: www.twitter.com/jbrodkin

Read more about cloud computing in Network World's Cloud Computing section.

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Jon Brodkin

Network World
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