Office 365 Home Premium vs. Office 2013 - Rent, Buy or Walk Away?

In the recent past, people had two choices for acquiring Microsoft's Office productivity suite - buy or pirate. Then along came Open Office/Libre Office, Google Apps, and other free applications, transforming the decision to buy, pirate, or skip altogether. Microsoft may not have to worry about losing its core business and educational customers, but Office's future in the home market was starting to look a little iffy.

As typical for Microsoft, its largest competitor was often itself. Given the cost of the suite, many users would opt to hang on to very old versions of the software rather than upgrade, creating security vulnerabilities and compatibility concerns along with the outmoded applications.

Jump into 2013 and the landscape has again changed with Microsoft's bold move to keep Office dominant, turning the buy-or-use-freeware decision to one of buy, rent, or use freeware.

Let's get that latter choice out of the way. Between Google Docs, LibreOffice and other solutions, there are legitimate alternative to Microsoft Office - if you don't really need 100% compatibility with Office documents. Even so, alternatives to PowerPoint and Publisher are largely second-cousin status; sure, they exist, but are you really going to spend your time hanging out with them?

To be crystal clear, there is no other single suite of applications that is so widely used as Microsoft Office. Word, Excel, and PowerPoint make up the core of this product line and nearly all computers in the U.S. have some version of Office installed. Outlook is less popular than it used to be, but still has a large and passionate user base.

So really, you now have two choices when it comes to getting the latest Office suite - rent or buy.

Read: Microsoft Office 2013 Review: Refinement, Integration, and Ribbons

For the low-low price of $99, you can unlock the entire Microsoft Office Suite for one year, equivalent to Office 2013 Professional. That's where the "365" in Office 365 comes from, but it still installed on your computer as Office 2013. Renting Office 365 is no different than purchasing a subscription for anti-virus software or your annual tax software, and while you may not be getting round-the-clock updates, Microsoft has pledged to release new updates and features to 365 users on a regular basis. When time runs out, so does your access to the software beyond the ability to open, read, and print documents. You won't lose access to your files you've saved to your SkyDrive and are free to open and edit them with another program or the online version of Office, but your access to the full editing features of Office is withheld until you upgrade.

As mentioned above, purchasing a 365 day license to Office 2013 gives you access to the hands-down best version of Office 2013 to date. But let's save that for another article. In addition to the full suite of Word, Excel, PowerPoint, Outlook, Publisher, Access and OneNote, you get the rights to install the suite on up to five PCs or Macs and "select other devices" that will (some day) include Android and iOS devices. Windows Phone and Windows RT devices already have Office included, and don't count against your subscription. You also get an extra 20Gb of SkyDrive storage for the primary account, Microsoft's cloud-based solution for streamlining how you save your documents, as well as 60 minutes of Skype calls per month and Microsoft's "Office on Demand" feature.

What is "Office on Demand," you ask? Say you are visiting a friend's house to collaborate on a flyer for a party you are hosting, and your friend doesn't have Office installed. No problem, assuming said friend has a broadband connection - you can sign into your Microsoft Live account and stream a full version of Publisher to your friend's laptop. When you're done just sign out and it's like you were never there. This feature is also great for environments where you don't have the ability to install software, such at the local library. One caveat: the PC must be running Windows 7 or Windows 8 to use this feature.

If you don't like to rent/lease things you would normally buy, Microsoft still offers an outright purchase option for Office 2013. You can get all seven applications for $399, or just Word, Excel, PowerPoint and OneNote for $139. Add Outlook to that package for an additional $80, or buy them ala carte for $109 each (OneNote is only $69). However, and this is a giant however, purchasing Office 2013 gives you the nontransferable right to install it on one PC only. Install it on your laptop and that laptop falls in the bathtub, so does Office 2013. Fry your motherboard with a bit of overclocking gone wild and you've just fried your Office 2013, also. In essence, you're not really buying the software insomuch as you are buying a license to use that software on a dedicated piece of equipment for as long as that piece of equipment lasts.

[Update: Microsoft recently revised their license policy for Office 2013 to allow the transfer from one PC to another in the event the original PC dies or is replaced (thank goodness). While this solidifies Office 2013 as a good value for a single user on a single device, it still doesn't dramatically alter the value proposition.]

When you purchase Office 2013 outright, you also get 7Gb of SkyDrive space (the default storage amount for new Microsoft accounts) as well as access to the cool streaming feature discussed above.

Decision Time: Choose Between Renting Office 365 or Purchasing Office 2013

Microsoft is clearly stacking the decision deck on this one to push people toward Office 365. Access to all seven Office applications for $99 a year is one heck of a deal if you have more than one computer or laptop, or you aren't exactly confident your equipment will be around for at least four years. If you have at least two computers or are apt to upgrade your setup more than once a leap-year cycle, then you'll want to go the Office 365 route. Furthermore, if you need anything other than what comes in the Home & Student Edition, Office 365 makes more sense long term, even for a single PC.

Assuming Microsoft doesn't radically change the year-two pricing structure or dramatically lower the single license purchase cost when it comes time for everyone to update to Office 2014, renting is the way to go for the foreseeable future.

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