We've got a series of Disruptive Technologies.
1) Web based
office suites
2) Inexpensive native office suites
3) Free office
suites
No single one will do significant damage to Microsoft's bottom
line. All three combined have a significantly larger impact.
Let's say
Web Based could take 1% of Microsoft's market, and the other options did not
exist. The impact on Microsoft would be minuscule. With the addition of Free
Suites and Inexpensive Suites, and the cross feed between users of the three
options, there is a multiplier effect. Exactly what impact the multiplier has is
difficult to gauge, but my personal feeling is that it is between 2 to 5 times
the market share a single option would get.
So rather than Web Based
taking 1%, the multiplier means it will take 2 to 5%.
The change in
usage of Microsoft alternatives should end up showing a pretty curve up, and a
pretty curve leveling off as each reaches 100% of its target
market.
Consider Apple iWork Suite. It only runs on Mac OSX and IOS, so
the mostly users it could gain would be 100% of Mac and iDevice users. A certain
percentage of Mac and iDevice users have no need for an Office Suite. Another
percentage prefer Web Based or Free, so iWork will remain a niche product, but a
profitable niche product, as it helps sell Macs and iDevices. But every sale of
iWork is a lost sale to Microsoft.
Microsoft's big problem is that once
a user switches, there is only a 10% chance that they'll come back to Office
(note that 10% is a guesstimate based on limited research by myself). That means
that the loss of 9 out of 10 customers is permanent (assuming my numbers are
correct). There are several reasons for this:
1) User only requires one
element of the Suite, I.e. Word Processor, and can buy the single part for
less.
2) User needs a product that is more capable than Office, say a
specialized writer's pack like Scrivener.
3) User can't afford Office
anymore - too many people are out of work, or working at jobs which pay
less.
4) User had a bad experience with Office - like the
Ribbon.
There are options missing from above, but the basics are solid.
Microsoft could compete by pricing Office at $10.00 per year, but they
won't. They can't afford to since Office is their most profitable
product.
Wayne
http://madhatter.ca
PS: apologies for the
formatting, Geeklog keeps putting extra carriage returns in. Yes, I could HTML
this, but my body is freaking on me, and I'm going to lie down.
I get an
Epidural on Friday. Hopefully it will help.
[NB - Three minor changes
- vowel added in "addition", title cap'ed, and emphasis added.] [ Reply to This | Parent | # ]
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