Microsoft Slashes Office XP Prices

The company claims its decision to cut software prices, including those of its Office XP family, is a "customer-driven move," not motivated by the Linux/open-source threat.

Microsoft Corp. has begun dropping the prices of some of its flagship software products, starting with the Office XP family.

The Redmond, Wash., software company on Wednesday will announce that it is cutting retail prices by between 15 percent and 30 percent on a number of products in its Office XP product family.

Microsoft is cutting the retail price of both the Standard and Professional Office XP products by some 15 percent, while also dropping the price for stand-alone applications like Word 2002, Excel 2002, PowerPoint 2002 and Access 2002 by some 30 percent.

Retail pricing before the cuts was $479 for the Office XP Standard Edition and $579 for the Professional Edition. The price reductions take effect Wednesday in the United States and Canada; they will also be rolled out globally.

While Microsoft has not announced or finalized the pricing for its upcoming Office 2003 family of products, "quite frankly we dont expect retail pricing to change from these new prices," Dan Leach, the lead product manager for Office, told eWEEK in an interview.

That would effectively mean that customers who buy copies of Office 2003 through the retail channel when it becomes available late this summer will pay some 15 percent less than what Office XP cost when it was first released.

The latest pricing move is not a result of slipping sales, Leach said, as Microsofts financial statement for its third quarter shows that Office sales grew by 9 percent year-over-year, attributable to increased sales of Office XP.

"We are always striving to make sure customers get the right software for their needs at an appropriate price," he said. "We want to give customers more options, bottom line. While we do take economic and other conditions into account, this is purely a customer-driven move to help price-conscious consumers benefit from the value of Office products."