Microsoft pricing shows they just don't get it

While commentators around the globe marvel at the 'instant' millionaires coming out of selling applications for iPhone and iTouch via Apple's AppStore, Microsoft has released US pricing for its upcoming release of Office 2010:

• Office Home and Student, featuring Word, Excel, PowerPoint and OneNote - $US149.
• Office Home and Business, featuring the above plus Outlook - $US279.
• Office Professional, featuring the above plus Publisher and Access - $US499.

These prices, with the likelihood that Australian prices will be pretty close to them, show that Microsoft also hasn't figured out the lesson from the AppStore success. So to help them out, Dear Bill and Co - it's simple: the iPhone apps are dirt cheap.

Buying an iPhone app really is a 'no regrets' purchase. Many apps are free, some only in cut-down 'evaluation' versions, and expensive ones are still under $10. Make a dud purchase, or don't end up using the app as much as you thought you would? So what? All you've lost is the price of a coffee and cake at the cafe.

Purchasing Office is a whole different situation. AUD600 is no small amount of bickies. And the competition is getting sharper against Office. OpenOffice and StarOffice continue to get people on the open source bandwagon, and with seamless file compatibility. Google Docs is sealing up a lot of us who work from many places, so value doing it out there in 'cloud' land. And the overheads of using MS products only continues to mount: giant (and growing) slow software with more features than most of us need, never-ending security hole patches, laborious software piracy control measures, and the pain of being tethered to a single PC. And even after so many years of development, some basic functions like autonumbering can only be made to work by the office equivalents of voodoo doctors.

Office may be ubiquitous in government cubicles. But it is far from so in homes and small businesses. And MS is not alone - Adobe also have some absurd pricing for products such as Photoshop and InDesign. Things have changed and software is a consumer product now - not niche stuff with high prices and heavy support loads.

Ubiquitous products come from consumer pricing. That's why AppStore will continue to make clever programmers into home office millionaires. And that's why Microsoft's dominance will continue to slide - they just don't get it.