Office365 or push Microsoft Profit and share price double growth

Lead: Seeking Alpha contributor Lash Mennaria (Rash Menaria), the US financial site, wrote today that Office 365 marks the transition from a traditional licensing model to a subscription model for Microsoft's software business, which will bring long-term profits and even boost share prices. The following is the full text of the article: Microsoft last week announced the launch of Office 365, bringing Office office suites to the cloud. This product is distributed to 40 markets worldwide, allowing users to access Microsoft Office, SharePoint online, and Lync products via the web. The product is located in small and medium-sized enterprises, using subscription fee model.　　The release of the product also highlights Microsoft's lead in business applications such as email, instant messaging, conferencing, file sharing and editing. User base for SMEs, Office 365 is a localized software and Google Apps alternative. Due to the normal operating security of about 99.9%, that is, the annual downtime of about 9 hours, so can greatly enhance user confidence. This protection is important for organizations that are committed to completing IT projects through managed services.　　By stripping applications from computers, Office 365 can penetrate 56 million of American employees without having to use dedicated computers and generate revenue streams of 270 million to 1.5 billion dollars. Price and function This product has three versions: 1 SME version, requiring staff less than 25 people, the price is 6 U.S. dollars per person per month, 2 Enterprise Edition, the price in each month between 2 to 27 U.S. dollars, 3 Education edition, is expected to replace liveedu. This product commitment will provide users with a very cost-effective choice. However, the benefits to users are not the savings of the original direct authorization fee but the cost of IT management and maintenance, which will benefit SMEs. For example, for a 100-person enterprise, it costs $32400 a year to use a 27-dollar service per person per month. Microsoft Office 2010 's 100-person authorized price is 49,900 US dollars. As a result, Microsoft has been able to generate more revenue from the second year.　　However, small and medium-sized enterprises can save a lot of IT management and infrastructure costs. Controlling piracy so far, Microsoft is still experiencing piracy problems in emerging markets, where growth potential is much greater than in traditional markets. Piracy has caused a great loss to the company's annual income.　　Cloud computing services may help reduce the piracy rate in emerging markets, as users now have a more viable and cost-effective option. Sales channels from the channel point of view, there are already 20 partners to start sales Office 365. The SME channel for fiscal year 2012 is expected to grow rapidly. Microsoft's partners include Intuit, Vodafone, Australia Telecom (Telstra), Telefónica (Telefonica) and NTT.　　Perhaps the biggest impact of profit on Microsoft is moving from a traditional software licensing model to a subscription model, although it may take a long time. By controlling a large number of SME data, Microsoft's products will get a lot of stickiness, ensuring a duplication of revenue. Assuming that Microsoft is able to maintain the same gross margin (75% to 80%) as the leading SaaS (software services) Enterprise, Office 365 is likely to have a strong profitability over time.　　The product also has the potential to become an integral part of mobile devices, and Microsoft has yet to make a contribution in this area. Share prices were spurred by rumours about Windows 8 and Office 365, which rose more than 7% per cent last week. But the stock's dynamic earnings ratio is still only 9 times times. I believe this will provide a very attractive opportunity for risk return over the next 1-2 years. The launch of the Windows 8 Beta, the release of the Nokia Windows Phone 7 phone and the good progress of Office 365 could become a catalyst for the unit later this year. In addition, focus on PC sales and Microsoft's long-term operating goals announced at its analyst meeting this September. (Ding Macro)