In South Africa, perhaps chosen for its distance from the communication centers of the world, Microsoft has begun rolling out the Office 2007 software- as-a-quarterly-subscription service.

This program, is not a new concept, as Bill Gates had referred to the plan in speeches at least 6 years ago. A similar program has been offered in Mexico and Romania, with the offering of Office 2003.  The program is ostensibly a move to make software more affordable for people of limited income, and for developing nations in general.

What is not generally spoken of, is the fact that by working this way, Microsoft accomplishes at least two things - each user will pay Microsoft directly, eliminating the retail and wholesale markets, and ensuring Microsoft makes the fullest profit, by making sure the price stays artificially high, throughout the product life cycle. For example, In South Africa, the subscription for Office 2007 is approximately $30 (US) each quarter, and the general lifecycle has been established by Microsoft at approximately 4 years. Over 16 quarters, the user will pay $480, well above what might be available at time of release with discounts, and certainly magnitudes higher than what could be had at the end of the cycle, when blowouts are had at a fraction of the retail, by vendors wanting to make the maximum order on the newer version soon to be released.

Remember that many people shop specifically at this time, always staying one level behind the latest available version, but well within the period of software support. This possibility would be cut off completely, again assuring maximum dollars for Microsoft.

On the side of Microsoft’s plan is the assumption that since the software will be renewed each 90 days, the user will be getting the ‘freshest’ version of the product. Thinking about the quarterly update plan, the user is confronted with all that is encompassed by that concept, both good and bad. In practice, the user might be saddling himself with a life of being a contributing [both meanings] beta tester.

[tags] Microsoft, software rental, Office 2007, FlexGo program [/tags]