From a personal finance perspective, I try to avoid any unnecessary recurring expenses. I figure I’m stuck with a cell phone, high speed internet and utility bills for the most part, but things like NetFlix, Premium Cable and Car Payments are things I can live without.
Software as a Service (SaaS) has been talked about for quite some time. Companies like Microsoft that sell expensive pieces of software such as Windows or Office experience large surges in sales as the version releases, but sales can tend to wane over time as users await the Next New Thing and refrain from buying the existing version. Enter SaaS, where companies charge you a monthly or annual fee for a ’subscription’ to the software. It expires after a year, likely disabling itself once the subscription expires.
SaaS has its benefits for sure:
- You always get the latest version meaning its much less likely that you’ll run into compatibility problems with your friend’s Office documents
- Instead of shelling out a large amount up front ($~300 for Office), you shell out a smaller amount each year to maintain your membership
- You probably won’t have to worry about losing the install CD. If you have a membership, you ought to be able to download a new copy and get up and running again with no problem
Unfortunately, SaaS has a nasty downside. Recurring expenses. Thats right, to your cell phone bill, internet bill, cable bill, car payment, house payment, credit card payments and netflix bill, tack on a few more expenses for your operating system, office software, photoshop, etc.
On Wednesday, July 2nd 2008, Microsoft formally announced Equipt. It’s first large-scale foray into SaaS for the masses. Equipt will contain Windows Live OneCare (Microsoft’s Antivirus solution), Microsoft Office and something called Office Live Workspace that will let you share documents online with other Equipt users.
Circuit City is selling the subscription for $70/year. This seems like a pretty good deal to me, though I hate the thought of having to shell it out each year. The reason I consider it a pretty good deal is that Microsoft allows you to install it on up to 3 machines and, the McAfee antivirus software that I use right now (which I don’t recommend) runs about $40/year to renew.
I haven’t tried Equipt, but it seems like Microsoft is in the right general ball park here with pricing. Its expensive, yes, but it stings a lot less than shelling out a few hundred bucks in one shot for a copy of Office that, in three or four years, will start having compatibility warnings due to newer versions being widely used in the marketplace.
The real winner here is Microsoft of course. Microsoft will have to maintain far fewer versions of office (since Equipt users will always be running a relatively recent version of the software) and Microsoft will get recurring income from Equipt for each user using Office. I don’t know about you, but I stay on Office as long as possible before buying a new copy because I’m not much of a power user. To Microsoft, this means they usually only get money from me once every 5 years or so. Equipt will mean they’ll be getting money from me every year, potentially for ever. I hate recurring expenses, but I love recurring income.
Overall, Equipt seems like it may very well be the future of software, at least high end packages such as Office, Photoshop, and maybe even operating systems so we may as well get used to it.
on Jul 6th, 2008 at 11:25 pm
There is an alternative — free, open source software. Have you considered giving OpenOffice a try? Don’t resign yourself to the tithing system they are implementing, There are alternatives.
on Jul 7th, 2008 at 2:47 pm
It’s somewhat nearer the right general ball park, anyway–which is “free.” I haven’t used Windows for years because I download and use Mandriva Linux. (Other of my friends prefer Ubuntu Linux because it’s designed with the Linux novice in mind and the user forums are very friendly and helpful, but I prefer Mandriva’s desktop environment.)
I haven’t needed to run anti-virus since I started to use Linux because Windows viruses have trouble running on it, and because when the Open Source community sees a security hole, they fix it ASAP. Many large organizations for whom data security is paramount run on Linux for that very reason. (Google and Amazon both run on Linux; Google is the largest Linux project in the world.)
Even before I took the Linux plunge, I didn’t need to buy an office suite. OpenOffice has every function I could ever possibly need (word processor, spreadsheet, a vector graphics editor and presentation editor) and a few I don’t (a math equation editor and a database program), and it runs on almost any operating system (Windows, Mac OS X, Linux, Solaris…). OpenOffice will open and save to most document formats, including .pdf. In fact, I’ve written and edited six textbook using OpenOffice, and I don’t miss MS office in the slightest.
I don’t miss Photoshop either; the GIMP filled most of my needs for graphics editing back when I was using Windows, and it fills them now on Linux. I don’t miss Explorer; Opera and Firefox work well enough (except for websites that insist on accessing your system through Explorer’s Active X module, but Active X opens my computer to drive-by downloads, so I prefer not to use it anyway) and have fewer security vulnerabilities. I don’t miss Outlook; I used Thunderbird instead until I moved to gmail.
If I were a gamer, I would miss Windows because it is still the best system for that. but since I’m not a gamer, I don’t miss it even one tiny bit. It’s the FOSS life for me!
(My apologies if I’ve messed up any of the html tags; typing is not my strong suite.)
on Jul 24th, 2008 at 7:40 am
And so it begins. Microsoft has wanted this for a very long time. It’s sad, though, the author starts off annoyed and angry by MS’s move, then becomes defeatist and resigned at the end predicting Windows will also become subscription based and “so we may as well get used to it.” That’s exactly what Microsoft wants. Your submission, and a monthly tithe. If you disagree with this, there are alternatives, such as Linux and OpenOffice.