I think people are missing the fact that like windows... office just has too big of an install base to go away. It would cost too much money to switch, and you'd need a large chunk of the world to do it with you. Everyone is just too familiar with MS Office to even think that an idea like converting to open office or some other solution would be logical, practical or even reasonable.
I happen to like the O365 model. For as little as $8.33 per month, you can get up to five seats residential. Most homes don't need five copies, but come on... even if you only need two your still barely paying more than $4 per month for office. You can also "share" (the option is baked right into the o365 website) office with friends and family ( think 4 or 5 more?) So you get 10 licenses. If that's taken full advantage of, the home user can get O365 for about $1 per month.
Business users have the option of paying $12.50 per user per seat for full office access, one drive, microsoft exchange email 50GB and much more. What does rackspace charge for 100GB exchange? $10 a month per box?
The biggest reasons I like the O365 model are that it's affordable. You don't have to try to get $150+ out of the customer up front, which won't have them tempted to try to get it pirated... $6 or $8 a month is a lot easier to swallow than $150+ on top of your fees if you set it up for them. The other reason is that I feel the developer has more of an incentive to keep up with the product, fix bugs, and continue to deliver when revenue is monthly and not paid for in advance. If I buy office 2013 retail from Best Buy and it is a disaster of a product, M$ already has my money. They don't have the risk of me canceling my subscription. They will most likely address things, but in their own time as now there really is no incentive to move faster. Just my thoughts.
