Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

The world’s largest software maker Microsoft Corp. (MSFT - Analyst Report) has announced plans to offer its subscription-based Office 365 software for students with up to six months of free access.

Office 365 is a cloud-based software suite officially launched in 2011. It is offered to customers in the software-as-a-service (SaaS) format.

Microsoft is offering students, with a qualifying .edu e-mail address, an opportunity to try Office 365 University for three months and 20GB of SkyDrive storage for free. Additionally, the company said that students who shared the offer on Facebook wouldenjoy another three months of free usage.

Management hopes to entice students with the latest Office, including SkyDrive’s cloud storage, a more touch-friendly design that works with tablets, touch-screen laptops and collaboration tools. The idea is to get them started on its platform, so they are more likely than not to make a purchase after the six-month trial period is over.

Microsoft’s Office 365 University comes with the traditional word processing, spreadsheets PowerPoint, OneNote, Outlook, Publisher and Access for a price of $79.99. It also offers 20GB of online storage via SkyDrive and 60 minutes of Skype calls per month.

Microsoft’s Office 365 is gaining traction in the market as it recently launched its online version focusing on touch devices. Further, it is being deployed at the stores of retailers such as J. C. Penney Company Inc. (JCP - Analyst Report) and U.K.-based Tesco as well as government departments, such as the Texas Department of Information Resources, which chose the software for inter-departmental activities. Recently, the International Federation of Red Cross and Red Crescent Societies (IFRC) also signed a MoU with Microsoft.

We believe Microsoft’s latest plan to offer Office 365 to students for a free trial is a great way to increase its presence in the education segment.

Currently, just like other PC makers, Microsoft is also battling the slump in the PC market caused by the sluggish economy. In addition, the popularity of smartphones and tablets from Apple (AAPL - Analyst Report) and Google has been cannibalizing PC market sales, further deteriorating the scenario. Whether it can come out of the slump on the back of its new software and OS is a wait-and-see game.

As per research conducted by IDC, cloud-based services may grow into a $100.0 billion market by 2016, representing a compound annual growth rate (CAGR) of 26.4%. Cloud services are expected to drive growth in IT going forward, generating 41.0% of overall growth in IT by 2016. Thus, the strengthening of Microsoft’s position in the segment is encouraging, as the PC market is showing no signs of revival in the near future.

Microsoft has a Zacks Rank #3 (Hold).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%