Microsoft Working on Office 15, Beta Launch in Early 2012
Microsoft (NASDAQ:MSFT) is one of the largest enterprise software makers, and completely dominates the market when it comes to productivity software, with its Office suite. Microsoft Office competes directly with Google (NASDAQ:GOOG) Docs, Apple (NASDAQ:AAPL) iWork and open-source alternatives like Open Office and Libre Office. Microsoft is working on the next version of the Office suite – Office 15, which will be launched in 2013, after the launch of Windows 8. [1] It is reportedly planning to launch the first beta of Office 15 in early 2012. Office 15 will have a completely redesigned interface, just like Windows 8, to work on both computers and tablets.
Office is Microsoft’s most valuable business in terms of revenue, and accounts for almost 29% of its $32 Trefis price estimate.
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Office 15 to Provide Significant Boost to Microsoft’s Revenues in 2013
Office 2010 was a huge hit and sold more than 100 million licenses. It showed an 8% increase in revenue last quarter, compensating for the lull in Windows sales. However, sales are expected to slow down considerably in 2012, as it becomes more than 2 years old. It recently launched Office 365, an on-demand, cloud based version of the Office Suite, in order to capture the growing cloud based productivity software market, in which Google Docs is emerging as a serious competitor. Office 365 sales have been picking up, but they are still too low compared to sales of Office 2010.
We expect Windows 8 sales to lift Microsoft’s revenues in 2012, followed by a further boost in 2013, with the launch of Office 15. Microsoft currently has a 94% share in the office productivity software market, which is expected to decline marginally over the forecast period, due to increasing competition from alternatives like Google Docs and Zoho Office.
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We currently have a $32 Trefis price estimate for Microsoft, which stands nearly 25% above its market price.
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