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Microsoft plans Office subscription service

"Albany," due to launch later this year, bundles Office, Windows Live OneCare, and various free Windows Live services into one subscription product.

Microsoft confirmed that it is planning a subscription service that combines the consumer version of Office with its OneCare security suite.

Code-named Albany, the product has a single installer that puts Office Home and Student, OneCare, as well as a host of Windows Live services, onto a user's PC. As long as users keep paying for the subscription, they are entitled to the latest versions of the products. Once they stop paying, they lose the right to use any version. Poll

Is a subscription service like Albany a more palatable option than the traditional means of getting Office?

Yes, this is more appealing.
No, I'd rather buy Office and own it the traditional way.
I'd rather not buy or rent Office and use a free alternative.

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The product is aimed at consumers that want a simple way to have access to Microsoft's productivity suite and keep their computer protected, Microsoft said.

"There is a customer segment that really enjoys this always-on, always up-to-date aspect of the service," Microsoft group product manager Bryson Gordon said.

Microsoft is planning to introduce a limited beta version of Albany in the coming days, with the aim of launching the product commercially sometime later this year, Gordon said. The company still hasn't decided on how much it will charge or how the product will be sold, he said.

In talking about the product, Microsoft did not refer to Google Docs by name, but I have said a subscription product might be Microsoft's way of trying to find a more palatable way of charging for Office amid stepped-up competition from free and online rivals.

By tying the Office subscription to OneCare, Microsoft is linking the purchase to one of the few areas where consumers have shown a willingness to pay for software--security. In this way, Microsoft can make the pitch to those buying security software that, for some extra dollars, they can always have the latest version of Office as well.

Those who subscribe to Albany will also get several free Microsoft products pushed onto their desktop--including online document-sharing product Office Live Workspace, Windows Live Messenger, Windows Live Photo Gallery, and Windows Live Mail.

Gordon argued that having all the products installed at one time is seen as a plus by the segment targeted by Albany, but he agreed that some users may not be interested in having so many Microsoft products foisted upon them. Office and OneCare will continue to be offered in traditional ways, he added.

Other products may be added in over time, he said, and Microsoft could also try the Albany approach for other market segments, such as small businesses.