The online push reflects Microsoft's recognition that people want access to documents and email on whatever Internet-connected device they might have, wherever they may be, whether it's at work, home or a store while running errands.
"The technology needs to be able to move with you," Schneider said.
It's the first time that Microsoft has tried to persuade consumers that a recurring online subscription is the best way to buy and use Office. Microsoft had previously sold online Office subscriptions primarily to small businesses.
"Over time, the majority of the billion-plus people using Office will be using the Office 365 service," Ballmer predicted in his blog post.
The attempt to sell online Office subscription to consumers comes nearly seven years after Google unveiled its own Internet bundle of word processing, spreadsheet and email programs. Google gives away a basic version of those applications, and charges subscriptions for more sophisticated packages aimed primarily at small businesses.
Microsoft's decision to reshape Office into an online service makes sense, although it may take customers a while to embrace the concept, said Edward Jones analyst Josh Olson. He suspects major companies that rely on Office probably will be among the last users to make the switch.
"This is a good innovation, but the uptake may be slow to begin because it is so different," Olson said.
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