Microsoft Needs to Keep an Eye on the Competition

5. The enterprise is changing

For years, Microsoft has relied on the corporate world to turn a profit. But the enterprise is changing at a rapid rate, and more companies than ever are looking toward the cloud to operate their businesses. When that happens, they enter Google's domain. And if they don't require all the power that Office offers, why should they pay for Microsoft's service when they can get access to Google Docs for free? It's a question that Microsoft will need to answer.

6. The competition won't stand still

More often than not, the argument in support of Office relies upon its power. Microsoft's suite of tools allows users to do more than any of the competition. But we can't forget that many of the functions built into Excel and PowerPoint aren't so outstanding that they can't be improved upon. Competing products could catch up if they are willing to spend the time and money.

7. Other competition

The attention in the Office market inevitably turns to Microsoft and Google. But we can't forget that there are several other companies out there trying to win over a new generation of office workers. Apple offers iWork. OpenOffice is an extremely useful tool. Even Zoho, a Web-based productivity suite, is worth considering when examining the future of Office. Microsoft has several competitors out there. And each of them wants to chip away at Office's user base.

8. Cost plays a role

Office is expensive. For years, that hasn't mattered, since it was the only viable productivity suite on the market. But today, there are several free alternatives that can deliver a worthwhile experience. How Microsoft plans to compete with free is anyone's guess. After all, the company has thrown bundles of cash into each new iteration of its software, and it simply doesn't have the luxury of offering it for free. Microsoft needs to find a viable strategy to compete with free services or Office could be in trouble.

9. Customer desire changes

As any company in the tech business knows, customer desire changes at a rapid rate. We're seeing a major change right now from desktop-based reliance to a more Web-based focus. As a company that has catered to the desktop, that's a problem for Microsoft. The company has the money to stick with customers wherever they go, but it needs to have the vision to do it. As customers continue to change opinions, Microsoft needs to be ready to meet new challenges.

10. Microsoft's focus

Microsoft might be taking Office for granted as it focuses on other, more challenging sides of its business. In recent months, Microsoft has doubled down on its focus on Google. The company is extremely worried that the search giant will corner the Web-advertising business and ensure that as more services move to the Web, Microsoft's influence is diminished. I get that. But Microsoft still needs to work hard on Office to ensure it doesn't get left behind. Office is still extremely important to its bottom line. The longer it focuses on Google and the less it worries about Office, the more trouble it might have maintaining its current standing in the space.