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In another sign of how fast the tech world is changing, you can now use Microsoft (Nasdaq: MSFT  ) Office products for free.

The company announced several months ago that Web-based versions of its ubiquitous Word, Excel, PowerPoint, and OneNote programs would soon be available on its website, and last night they went live. Even though they're not as full-featured as the pay versions, you're right to ask why Mr. Softy would give away programs on the Web that it charges you hundreds of dollars to run natively on your computer. Competition is the reason, of course, especially in the online-based world of cloud computing.

Free Web-based software such as Google (Nasdaq: GOOG  ) Docs and the open-source (now owned by Oracle (Nasdaq: ORCL  ) have been offering basic word-processing and spreadsheet applications for years. Microsoft has no doubt seen a loss of mind share, if not real dollars, as millions of users seeking simple solutions turned away to other companies.

Old-style business models just don't work as well any more, and as Chris Anderson points out in his book Free: The Future of a Radical Price, giving away stuff is a great way to accumulate customers who will eventually pay for premium products.

These free applications should also help Microsoft compete more effectively with Apple's (Nasdaq: AAPL  ) MobileMe service, which offers online storage and integration with Mac computers, iPhones, and iPads.

I love reviewing free stuff
Now, I'm a heavy Word and Excel user. As a writer and analyst at the Fool, I use them every day in the office. I don't have these expensive programs installed on my home computers, however, since I prefer to use the cash for burritos, beer, and other breakfast items. Instead, I use the free Google Docs or OpenOffice applications instead.

To see how well the free Office apps work, I used them to write this article and to calculate a few simple stock returns. They were very easy to start up and use, and newbies should have no problem navigating the simplified menus. Things are just a tad clunkier and slower than I'm used to, like waiting for formula calculations in Excel, but in all it's a fine experience. (I couldn't find a Word Count feature, though, which is a must for a writer.) Files are saved on the cloud-based Windows Live SkyDrive, and they can be accessed anywhere with any computer and, of course, shared with other users if you wish.

Foolish bottom line
When all is written and done, these free Microsoft apps don't offer anything beyond what their Web-based competitors do, except for that familiar MS Office look and feel. Which is why I will start using them now -- as will, I suspect, most other Office users.

If you've tried out the free Office apps, let me know in the comments box below how they compare with Google Docs and other free software.

Fool analyst Rex Moore is hoping Starbucks moves to the free business model soon. He owns shares of Microsoft, which isa Motley Fool Inside Value pick. Google is a Motley Fool Rule Breakers selection. Apple is a Motley Fool Stock Advisor recommendation. The Fool owns shares of and has written puts on Oracle. Motley Fool Options has recommended a diagonal call position on Microsoft. The Motley Fool has a disclosure policy.

Read/Post Comments (4) | Recommend This Article (28)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 10, 2010, at 1:37 PM, sarcophagus wrote:

    "Instead, I use the free Google Docs or OpenOffice applications instead."

    'nuff said.

  • Report this Comment On June 10, 2010, at 2:53 PM, johndmueller wrote:

    I just tried using the new online office and it wouldn't even load--I get a bunch of broken link pictures and that's it. I'm on a Mac running OS 10.5x and browsing with the latest version of Chrome.

  • Report this Comment On June 10, 2010, at 4:12 PM, mDuo13 wrote:

    Personally, the sacrifices that come with web apps are usually a deal-breaker for me, which is why I continue to use OpenOffice at home. In fact, with the drastic interface changes to Office 2007, I find myself longing for OpenOffice even at work -- but the need for compatibility with coworkers' Office 2007 apps makes it more headache than it's worth.

  • Report this Comment On June 11, 2010, at 10:37 AM, SPARTANBURG wrote:

    I tried to get into website to no avail. It let's me in, shows me the documents available (4 of them) and then says they are not available and sends me to Skydrive. Maybe it's doing it because I tried using it outside the U.S.

    On the other hand, Google apps worked immediately.

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