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iWork mobile productivity suite for free.
The move is a potentially big deal; Microsoft's refusal to release an iPad-optimized version of Office has drawn ire from a number of analysts and shareholders who feel the company could reap billions with such a release. Microsoft has instead attempted to position Office as one of Windows 8 and Windows RT tablets' differentiating features. With iWork now filling a role that might have been filled by Office, Microsoft's options might be shrinking.
Indeed, the iPad is still the top individual tablet line both among consumers and in the enterprise. Research firm IDC projects tablet shipments will exceed PC shipments this quarter, and Apple's new iPads, expected later this fall, will almost certainly be a huge success. Given this context, will Apple's free iWork force Microsoft's hand? Here are five factors to consider.
1. Many tablet users are interested in basic productivity. iWork caters to this interest.
PCs remain the preferred option for heavy-duty productivity, with tablets praised more for their content-consumption capabilities. Still, many tablet users want to do more than surf the Web, read email, watch videos and share photos on social media. A recent Forrester study found that almost two-thirds of knowledge workers want to use keyboards with their tablets, for example, which suggests a need for legitimate word-processing and project-creation capabilities. By offering iWork for free, Apple has only made the iPad that much more suitable for such demands.
[ Releasing bad software updates doesn't help Microsoft's case. See Microsoft Nukes Buggy Office 2013 Update. ]
Granted, Apple has left iPad keyboards mostly to third-party companies such as Logitech. But users haven't seemed deterred. As Forrester analyst David Johnson noted in an interview, "A lot of people are using keyboards on their iPads."
2. iWork could hurt Windows tablet sales.
Given the aforementioned Forrester study, it's curious that keyboard-centric Windows tablets such as the Surface Pro and Surface RT have sold so poorly. Windows 8.1 and Windows RT 8.1 tablet could still help Microsoft turn things around, but analysts expect iPads to hold their ground.
Even before the iWork announcement, experts were confident in the iPad line's continued popularity. In a July study, Gartner analyst Mark Cotner concluded Windows tablets will not displace iPads in the enterprise. He noted that users prefer the iOS experience, that iOS can be more productive in a multi-device workflow than some IT managers realize, and that employees will continue to bring their iPads into the office, even if corporate-owned Windows tablets are deployed.
A recent Forrester survey, meanwhile, found that 44% of enterprise tablet users prefer iOS, compared to only 14% who prefer Windows 8. These results are a dramatic shift from a similar Forrester study conducted with a different group of respondents last year, just before Windows 8 launched. In that report, almost one-third of participants were interested in a Windows tablet, with only 26% opting for iOS.
With iWork added to this strong base, the Pad will only grow more attractive, according to Gartner analyst Carolina Milanesi. In an email, she said iWork should further enable iOS devices to integrate into the enterprise and could persuade users that they don't need Office for everyday productivity.
3. iWork pressures Microsoft not only to release Office for the iPad, but also to price it competitively.
According to ZDnet, Microsoft might wait until late 2014 to release Office for the iPad. With iWork now in the equation, such a timeline might not be tenable. Forrester analyst David Johnson said iWork could be a "disruptor" because "with so many iPads out there, and with iWork on each, people are going to get used to it."
Milanesi said iWork should influence not only when Microsoft releases an iPad-optimized Office suite, but also how the products are priced. If the versions of Office for the iPhone and Android-based smartphones are any indication, this pressure could throw a wrench into Microsoft's plans. Users need an Office 365 subscription to use those apps, but due to iWork, the same tactic might not work for an iPad release.
4. iWork for iOS could gnaw into Microsoft Office's PC business.
In an email, Gartner analyst Michael Silver said iWork "is mostly a consumer thing," but that "consumer choices bleed into the enterprise."
The implications stretch beyond tablets. Apple also produces iWork apps for OS X as well, and the company said at its Worldwide Developer Conference that new versions of both the mobile and desktops apps will be released later this year. If iWork becomes popular on iOS, it certainly can't hurt the popularity of iWork on MacBooks and iMacs.
But the bigger factor could be iWork for iCloud, which is currently in a free public beta. Apple hasn't confirmed whether the apps will remain free once iWork for iCloud officially launches, but the Web apps are nonetheless interesting because they're platform-agnostic. If a user begins working on a project on her iPad, she will be able to continue it seamlessly on a Windows PC, and vice versa. iWork will never replace Office in the enterprise, but that doesn't mean Office will continue to enjoy monopoly-level market share forever, especially among users who don't require the software's differentiating features.
5. iWork doesn't face a sure path to success.
Even if it's successful among iPad users, iWork won't necessarily rocket to tablet dominance. Johnson noted that factors such as iWork's mediocre compatibility with Office could be problematic; he said enterprises are "very clear" that such compatibility is essential.
It's also noteworthy that iWork apps have never been prohibitively expensive at $9.99 apiece. The apps' usage will certainly go up now that they're free, and with new versions coming, Apple might have compelling new features in store. But if iWork were going to silence demand for Office on the iPad, shouldn't it have already started to happen?
iWork additionally faces capable mobile competitors, such as QuickOffice Pro and OpenOffice, and Google is certainly advancing its own mobile productivity agenda with not only Android, but also Chromebooks. Windows tablets could also still rebound with faster, sleeker Windows 8.1 and Windows RT 8.1 models, many of which will come bundled with Microsoft Office, and some of which will cost less than iPads. And then there are emerging contenders such as Box, which just expanded its services to include cloud-based documentation creation. Free iWork downloads are an interesting addition to the fray, but with so many upstarts fighting to gain traction, don't be surprised if Office isn't dethroned any time soon.