Microsoft has announced pricing for the newest version of the popular Office Suite of products. Like the announced death of the popular Small Business Server, Microsoft is killing off many of the advantages of popular Office suites. For Office 2013, all the purchased suites will be single license suites. This will remove two of the three licenses included in the Office Home and Student suite and one license in the Office Home and Small Business suite.

In its place, Microsoft is recommending their new subscription series of Office Suites. The Office 365 Home Premium subscription will give you 5 licenses, 3 times the amount of SkyDrive storage (20 GB added to the free 7GB), and 60 minutes of Skype phone calls for $8.33 per month. You will be billed $99.99 at an annual basis. The Office 365 Home Premium subscription includes Word, Excel, PowerPoint, OneNote, Outlook, Access and Publisher. The subscription covers both Mac (excluding OneNote, Access and Publisher) and PC versions of the product.

The Microsoft Office 365 Small Business Premium suite offers the same products and throws in Lync. Like the old Office Home and Small Business suite, the licenses are per user, but can be installed on 5 devices. The Office 356 Small Business Premium user will get a 25GB Outlook mailbox, the ability to host online meetings with audio and video using on-click screen sharing. They will also be able to setup a public-facing website for no additional fees. The cost per user is $12.50/user/month and is billing annually at $149.99.

In the Micorosoft announcement page (http://blogs.office.com/b/office-news/archive/2012/09/17/the-new-office-365-subscriptions-for-consumers-and-small-businesses.aspx) information on traditional retail box purchase options are found in a single paragraph at the bottom of the announcement. Office 2013 Home and Student is now a single license product selling at $139.99. No pricing information was given on any of the other options.

So what does this really mean? I really don’t work with home users, so I will not make any assumptions on how long people go between updates, so I can’t really compare the subscription price to the box price. Currently, Office 2010 Home and Student is a 3 license product selling on the street for $121.99. With a license to license comparison, that is a 246% price increase (99.99 * 3 = 299.97 / 121.99).

I can make assumptions from a small business perspective. Most of my clients are on a 5 year replacement plan. So my typical user has one, possibly two installations of Office; one being a workstation and one being a laptop. The majority only have one instance, so for this example, we will ignore the second “mobile” license included in Office 2010 Home and Small Business and the extra 4 licenses in the Office 2013 subscription. Comparing the Office 2010 street price of $247.99 to the new subscription price for a 5 year time span, we have a 302% (149.99 * 5 = 749.95 / 247.99) price increase.

So what am I recommending to my clients? Buy now before you pay through the nose.