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The wires are buzzing this week as Microsoft is reportedly experimenting with subscription-based versions of their productivity and security software packages. The new pricing plan, code-named “Albany”, is currently in private beta, and no announcement has yet been made as to when a wide release is scheduled. Albany will combine many of the tools that Microsoft users access on a daily basis, and the subscription will ensure that they always have the latest version without going through the headache of installing and updating software.

Albany will include Microsoft Office Home and Student 2007 (a combo of Word, Excel, Powerpoint, and OneNote), Windows Live OneCare (an anti-virus tool), Live Mail, Messenger, and Photo Gallery. It will also automatically install a shortcut to Office Live Workspace in users toolbars, which give access to on-demand versions of the Office tools. This combination is meant to appeal to users who aren’t satisfied with licensing agreements, which are not only expensive but also force users who want new versions to buy new licenses.

A Microsoft press release explains how the idea for Albany came about: “We asked consumers what they needed and wanted most on their PC, and the overwhelming response was that they primarily want productivity and security software. Consumers also expressed frustration at having to spend time and effort installing different types of software, keeping current on new versions and getting their computers set up.” The subscription plan eliminates this frustration by providing automatically updating software for a regular fee. Albany customers will always get the new software releases as they’re launched without paying more - it’s included as part of their subscription.

Reviews and reaction to Albany, as is customary for all Microsoft products, is mixed. One CNET blogger writes, “Seriously, this is pointless junk. The only real value is to Microsoft who get to see usage patterns and understand how on-demand software is consumed.” A bit harsh, but it is likely a perk of the venture that was not lost on Microsoft executives. A ReadWriteWeb article is considerably more forgiving: “Even though Albany won’t be a true web office offering, it is a likely low-cost alternative to Google Docs that lives on a user’s PC — something that is still more comfortable and familiar to many mainstream users.” Microsoft is clearly testing the SaaS waters before committing to any big move, and it seems this may hurt their chances in the eyes of some while helping hold on to more traditional customers.

While the plan for Albany falls short of a true Software as a Service model, it resembles the pricing and updating philosophies of companies like Salesforce.com and Google, both of whom are edging into Microsoft’s productivity software market. Salesforce.com tends to target businesses with customer relationship management (CRM) tools, while Google has been directly threatening Office with their online document, spreadsheet, and presentation applications. Microsoft’s Office Life is a nod to the SaaS trend, though it has yet to catch on with core customers in the business sector. As Albany moves towards a firm launch date, Microsoft’s competitors will be watching closely to see how users react to the packaged subscription model.

Tuesday, April 29th, 2008 You can skip to the end and leave a response. Pinging is currently not allowed.

By Haley January Eckels