How Will the New Office for iPad Work?

Ed Bott:

Microsoft is morphing into a devices and services company. They are aggressively getting out of the perpetual license business with Office and moving to a subscription model with Office 365. So why would they deliberately build up that old-fashion license business on another platform, where they would have to pay Apple a 30 percent cut of the proceeds on every sale?

They won’t.

I’m assuming that Microsoft is going to give away its iOS app for free. Just like it’s currently giving away its OneNote apps on iOS (free for up to 500 notes, then a paid upgrade) and Android (a similar freemium model) and Windows 8. Just like it’s made its Office Web Apps/SkyDrive combo free.

Sounds right to me, but Apple doesn’t only collect 30 percent on the sale of apps — they want 30 percent of subscription revenue purchased through the app as well. So if you already have a subscription to Office 365, you could just download the Excel or Word or PowerPoint app for iOS, sign in, and start using it. But if you don’t already have an Office 365 account, what happens then?

This has been a source of conflict between Apple and Microsoft ever since Microsoft committed to developing serious apps for iOS. Unless I missed something, it hasn’t yet been resolved.

★ Monday, 4 March 2013