Microsoft’s big bet on paid subscriptions for Office appears to be on the right track. While the company reported early signs of success with 1 million Office 365 Home Premium subscribers back in May, that number has now doubled to over 2 million. Subscribers pay $9.99 a month or $99.99 per year to download and install Office software on PCs and smartphones, alongside access to Microsoft's cloud services to store documents and settings.
Office 365 Home Premium sales are still a small percentage of the overall Office sales to enterprise customers and other businesses, but the transition to the cloud is going steady. It’s a key part of Microsoft’s new “devices and services” strategy to sell hardware to consumers and services on top. Although consumers appear to be interested in signing up, Microsoft’s Office Consumer revenue has declined in its latest quarter compared to last year. The company says the impact of the shift to Offices services in the cloud was “generally in line with expectations,” so if it keeps doubling subscribers at a good pace then that revenue should return in the long term.
It’s still too early to say whether Microsoft’s efforts to counter free web-based Office alternatives have been successful, but there’s clearly still demand for standalone versions of Office away from the browser.