Office 365 Home Premium review: Is Office better by subscription?

Money matters

It's pretty obvious that Microsoft wants to encourage users to go with its new subscription plans. Prices for the traditional Office suite are now higher than they were before and some multi-license versions have been eliminated.

The question is: Will you be better off going with the subscription model or buying Office 2013 in the traditional manner?

Well -- it depends.

The Office 365 Home Premium subscription costs $100 a year for up to five PCs and Macs (including tablets). That includes automatic free upgrades to new versions of Office. You also get 60 minutes of free Skype calls every month and 20GB of additional SkyDrive storage over the basic free 7GB.

Depending on how you use Office, this new subscription model can be a tremendous money saver or a losing proposition. If you use Office on several computers (and if you use non-core applications such as Outlook, Publisher and Access) Office 365 Home Premium can save you a lot of money. The Professional version of Office 2013 -- which includes Word, Excel, PowerPoint, OneNote, Outlook, Publisher and Access -- costs $400 for a single install. Buy that for five computers and it adds up to a whopping $2,000.

If you use several computers, don't need Publisher and Access, but do use Outlook, it still makes more financial sense to buy Office 365 Home Premium. Office 2013 Home & Business, which includes Outlook but not Publisher and Access, sells for $220. So for five PCs and Macs, that would run $1,100 -- still considerably more expensive than the $100 per year subscription.

However, if you don't use Outlook and/or you use Office on fewer than five machines, the economics become murkier. The Home & Student version of Office 2013, which includes the core applications of Word, Excel, PowerPoint and OneNote, but doesn't include Outlook or other applications, costs $140. If you only need Office on a single machine, in four years you'd pay $400 for the subscription vs. $140 for the traditional version. You'd even save money if you bought the Home & Student version for two machines --- $280 vs. $400. But if you then upgrade, you'll have to pay for a new version of Office.

If you can prove you're a college student, by the way, the subscription route is definitely the way to go -- you can get Office 365 University for $79.99, which includes a four-year subscription that covers two machines.

And of course, if you're purchasing one of the business versions, you'll have to also factor in the features you need for your enterprise and how the subscription model works with your staffing needs, among other things.

The upshot? For quite a few people, the new subscription model makes more financial sense than buying using the traditional route. But not for everyone.

Bottom line

Microsoft Office 365 Home Premium offers an entirely new way of paying for Office via subscription. If you use Office on multiple computers, there's no doubt that the new subscription service could make sense for you. Not only will you save money, but the Web-based tools also make it easy to see at a glance all of your Office files on all of your computers. Given that you also get additional SkyDrive storage and 60 free minutes of Skype, it's a no-brainer.

If you only use Office on one or two computers, though, it's not clear whether you'll want to move to a subscription model. You'll pay more money for Office and the extras might not be worth it for you.

But given that almost everyone at some point will be using multiple machines, it looks like Microsoft Office 365 is the wave of the future.

Preston Gralla is a contributing editor for Computerworld.com and the author of more than 35 books, including How the Internet Works (Que, 2006).

See more by Preston Gralla on Computerworld.com.