By Tak Sato
Since graduating from college more than three decades ago, I’ve been through two cars; I’m currently on my third. I buy/finance my car instead of leasing it. It feels good to make that last payment and own my car instead of having nothing to my name when a lease ends.
Not long ago, we had to buy software applications to install on our computers; it’s called perpetual licensing. But for more than a decade, the software industry has been moving away from this business model and instead adding or outright replacing it with the subscription (leasing) format.
Own It? Maybe
Some companies, like Microsoft, offer both the buy and lease options for their office productivity software suites that include Word, Excel and Powerpoint (word processing, spreadsheet and presentation applications, respectively). Other companies have moved to offering only subscriptions by leasing their software. Subscriptions are what fuels cloud-based, internet-based offerings ranging from Netflix (movies) or Spotify (music) to cloud storage and everything in between.
Back to Microsoft’s Office. Should you buy it or lease it? This question comes up often, especially when someone buys a new computer. The answer? Compare the cost of ownership over the short-term, like three years.
For example, how much would you have paid at the end of three years if you bought Office 2021 for Home and Students if you only need one installation of Office on one computer for your non-commercial use?
Your three-year cost would be $150 to buy versus $210 under the Microsoft 365 Individual (subscription) plan. Remember that you can use Office 2021 for Home and Student installation as long as Microsoft supports it without paying a penny more in year four and beyond, versus paying $70 annually for the subscription. Buying it outright makes sense.
But if you had a family of five and everyone needed Office on their computers, the three-year total cost of ownership would be $750 (to buy the five licenses) versus $300 to subscribe to the Microsoft365 Family (subscription) Plan, so a subscription makes sense in that case.
What about paying for an upgrade of Office? My response: how fast can you type? A newer version of Word won’t make you type faster. Unless Microsoft ceases support of the Office version you’re using, save your money for a rainy day.
But wait, there is at least one other option. Freeloading is where you use a cloud service version of Word, Excel and/or PowerPoint, which may work for many people out there with basic needs. Using your favorite web browser (Chrome, Firefox, Edge, Safari, etc.), you can access the cloud-based office services Microsoft offers for free. You will be saving the documents, spreadsheets and presentations you create in Microsoft’s cloud storage service called “OneDrive” as a default, but you can just as easily download the file to your device if you want to.
Many people use their computers to simply check emails, stream entertainment, browse the web, shop online, or do their banking. An educated consumer is the best consumer, even in the digital world. Always choose appropriately.
