In a speech Wednesday at the Morgan Stanley Technology Conference in San Francisco, Microsoft Business Division president Stephen Elop said that his company would likely ship a free, ad-supported version of Office 14, the next version of Microsoft Office that is due in 2010. Microsoft sees ad-supported products as a way to combat piracy, Elop said.
"There will be ad-based revenue streams," Elop said. "There's an opportunity to draw those pirate customers into the revenue stream. We want to draw them into the Windows family and maybe there's an upsell opportunity later."
It's unclear if Elop was referring to the web-based Office Web Applications services that will ship alongside the traditional Office 14 suite next year; Microsoft had previously said that those services would be ad-supported. But Microsoft has been looking at different revenue possibilities for Office for years and has tried various subscription models, most recently with its recently cancelled Equipt suite, which couple Office 2007 with Windows Live OneCare.
As is the case with Windows, the number one competition for Office isn't some competing product, in this case solutions like Google Docs or OpenOffice.org, but rather pirated versions of its own software. So addressing that market actually does make some sense, since Microsoft isn't currently deriving any income from pirated Office copies.