Many product strategists are, like me, old enough to remember software stores like Egghead. Those days are gone. Today, consumer packaged software represents a very limited market – the software aisle has shrunk, like the half-empty one at the Best Buy in Cambridge, MA (pictured).
Only a few packaged software categories still exist: Games. Utilities and security software. And Microsoft Office – which constitutes a category unto itself. Some 67% of US online consumers regularly use Office at home, according to Forrester’s Consumer TechnographicsPC And Gaming Online Survey, Q4 2009 (US). Office is the most ubiquitous – and therefore successful – consumer client program aside from Windows OS.
Office 2010, Microsoft’s latest release, will continue to succeed with consumers. On the shoulders of Office 2010 rests nothing less than the defense of packaged software in general. It’s also the most tangible example of Microsoft’s Software Plus Services approach to the cloud – a term that Microsoft seems to be de-emphasizing lately, but which captures the essence of the Office 2010 business goal:
To sell packaged client software and offer Web-based services to augment the experience.
As I wrote about in “New Growth Opportunities In The Consumer Security Market," my view is that PC-based protection, no matter how broad, is the new "point product," and the new “suite” that consumers seek is product plus services whose functionality goes beyond security to help consumers deal with their other major challenges as well. Security is still important, but privacy is a huge and largely unmet need, and so is supporting the new consumer computing models, as my colleague Frank Gillett formulated a year ago with the concept of "The Personal Cloud." Frank and I are currently discussing ways to bridge our research streams more formally.