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Starter

March 2010



Office Starter 2010

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Starter contains reduced functionality versions of Word and Excel, and includes advertising.

Office Starter 2010 is replacing Works as our PC coverage solution.

Starter will be available exclusively on new OEM PCs – shipping on 140 MM per year.

Starter Better than Free Alternatives … but Differentiated from Full Office.

Move Compete / Pirate / Old Version Users to

Starter

Move Starter Users to Full Offi ce

http://docs.google.com/



Coverage

Engagement

Upgrade

Starter’s Strategic Value

Starter Delivers Critical PC Coverage• 70% of people leave store without purchasing Office.• 80% of people choose productivity suite within 6 weeks• 6 ½ times higher works usage when pre-installed• 78% of Works user tell us they use Works b/c it’s Preloaded.• Compete usage is 2 ½ times higher when Works not on PC

Drive Office Engagement with Superior Coverage Solution• 20% of non-buyers cite “lack of familiarity” with Office as primary

reason not to buy• Keep non-buyers in the Office family; let people explore the live

services and the perspective to enroll to Office Web • Negative consumer reaction to trial software, low conversion rate• Works lacks Office brand, file compatibility, user interface

Drive upgrade conversions to full Office• Starter offers perpetual in-product upgrade• Starter is not a trial and does not expire• 16.3% of initial beta users interacted with upsell hooks in first

month on beta.

Starter’s strategic value is to put non-buyers back on the path to purchase.



Starter Walk-ThroughStarter at a Glance

Applications Word Starter, Excel Starter

Features Reduced feature set

Customization No customization to the Ribbon, Backstage, or the Quick Access Toolbar

Programmability No VBA support (Developer tab is removed), Add-ins do not load

Advertising Yes

Number of installs 1 (pre-installed on new PCs only)

Operating System Vista SP2 or Higher. No XP.

Back up media Not available unless OEM ships back up recovery of full hard drive

Support OEM support, free community support, paid support available

Language packs Not supported

Activation required

No

Availability OEM only – no download or purchase

Ad is persistent, rotates every 45 seconds when product in use

Right task pane is persistent. Provides upsell, tips and links

to content.

Button to purchase full Office

Four tabs for basic home use. Removed: References, Review, View, and Developer. In Excel,

Data tab is removed.

Tabs have commands /

features removed.Cannot customize

quick access toolbar

Cannot customize Ribbon



What Features Is Starter Missing?

78% of small businesses use at least one removed Excel feature

68% of home customers use at least one removed Excel feature

50% of consumers use at least one removed Word feature

Functionality Removed Word Starter

Excel Starter

Home and Student

Applications PowerPoint, OneNote

Tabs References, Review, View, Developer, Data (Excel only)

References

Table of Contents n/a

Bibliography / Citation n/a

Footnotes n/a

Document Protection

Restrict Permissions

Password protection

EnhancementsSmart Art

Equation Editor

ViewingFreeze Panes n/a

Navigation Pane n/a

Customize

Quick Access Toolbar

Ribbon

Macros

CollaborateTrack changes

Comments

Data

Pivot Table n/a

Pivot Chart n/a

Slicers n/a

External Data n/a



• Half of Starter users will be from piracy who want legal, affordable Office offering.

• Broader footprint with Office 2010 pre-load will win some previously naked/ nothing PCs.

• Convenience of pre-install will win Works users and some competitive users.

At Risk Home and Student6%

Office Pirates49%

Office Users7%

Nothing / Naked23%

Competi-tive1%

Works Users13%

Majority of Starter Users will be from Non-Genuine Office Sources

Starter helps home users not ready to buy, access their existing Word and Excel® files, get familiar with a limited selection of Office 2010 features, and upgrade easily to a complete Office 2010 suite whenever they’re ready.

Who is Starter For?Starter is for Consumers Not Ready to Buy



75%

48%

39%

32%

16%

8%

PowerPoint

Outlook

Publisher

Access

OneNote

Groove

Which applications do you need?

72%

28%

Yes No

Need applications that Starter does not include

60%40%

Yes No

Need features in Word or Excel that Office Starter does not include 36%

32%31%31%

26%25%23%22%21%

16%13%11%10%

5%

What features did you need?

Smart Art Graphics

Comments and Track Changes in Word and Excel

Text to Columns in Excel

References, Footnotes, or Bibliography in Word

Macros or Add Ins in Excel and Word

Customize the Quick Access Toolbar in Word or Excel

Table of Contents in Word

Getting Data from External Sources in Excel

Freeze Panes in Excel

Advanced Filter Options in Excel

Equation Editor in Word

Pivot Tables in Excel

Goal Seek in Excel

Other

What Do People Need that Starter Doesn’t Have?



Reasons Office Starter Was Not Right Software: Top-3

72%

60%

42%

39%

36%

25%

13%

12%

I need applications that Office Starter does not include

I need features in Word or Excel that Office Starter does not include

It seems to have less functionality than COMPNAME

I just like COMPNAME better

I didn't like the advertising

I didn't like the pane on the right side of the screen.

I did not like the user interface

I don't like the name of the product

44%

18%

17%

7%

6%

5%

3%

2%

I need applications that Starter does not include

I need features in Word or Excel that Starter does not include

I just like what I have now

I didn't like the advertising

It seems to have less functionality than COMPNAME

I didn't like the pane on the right side of the screen.

I don't like the name of the product

I did not like the user interface

Single Best Reason For Office Starter Not Being Appropriate

Dimensions that Create Greatest Differentiation Between Starter and Full Client

31%

16%

15%

12%

10%

7%

6%

3%

PowerPoint is not included in Office Starter

Office Starter includes advertising in a right pane that is always open

Outlook is not included in Office Starter

Word Starter does not have some features

Publisher is not included in Office Starter

Excel Starter does not have some features

Access is not included in Office Starter

OneNote is not included in Office Starter

Most Limiting Factor

• When positioning full Office vs. Starter, lead with missing Applications – particularly PowerPoint – these are Starter’s most limiting factors.

• The Advertising and Right Panel are the #2 impediment to Starter adoption.• Missing features in Word and Excel are the third reason Starter does not meet needs of full Office users.

Less Specificity More Specificity



SmileFrown

Office Starter Beta User FeedbackStriking the Balance

Beta users provide product feedback via the “send-a-smile” (SAS) program – positive comments are “smile” and negative are “frown.” Feedback specific to Starter’s fell into 10 categories. Note: Some areas that saw little feedback (missing applications, n=5), had far greater response through other customer channels – such as forums. Key insights from SAS:

• Advertising: Nearly 9 out of 10 comments regarding advertising were negative – 12% of comments total.• Feature removal: 95% comments were negative.• Basic use: 53% positive and 47% negative indicates good balance – Starter is for some, but not everybody, even in basic use.• New features: 92% positive comments – if 20% of non-buyers cite “lack of familiarity” with Office as primary reason not to buy, Starter

is a good opportunity to expose people to some of the great new features and UI in 2010.

Accessibility

Ad Pane

Basic Use

Compatibility

Feature Removal

Missing Apps

Setup

User Interace

6%

16%

53%

34%

5%

10%

92%

26%

53%

94%

84%

47%

66%

95%

90%

74%

47%

8% New Features



Office Starter Beta User FeedbackStarter Customer Feedback tracking to product design and positioning

Starter Not Fully Meeting Needs Starter is Good Enough

Advertising: “I'm trying to write a final exam paper and the advertisement on the bottom right keeps flipping to different images and is distracting when I'm trying to concentrate.”• Ad bar intrusiveness is #1 bug (34% of votes)

Missing Programs: “MS should integrate POWERPOINT to Office Starter. Firstly, student who need to do PPT presentations will use

General Use: “The starter editions have all the functions necessary for basic documents.”

“Microsoft Office Starter (Word) has the right amount of features that I use, and probably a large percentage of Word users.”

“So far - both Word and Excel have been great.”it. Second, POWERPOINT is an essential tool, without it, it may not be complete.”

Missing Features: “A little disappointed that there are no commenting options. I consider that a basic feature.”

“In my work with Excel I need Macros.”

“No footnotes? Students will never use it.”

Others: Outlook, SmartArt, customize quick access toolbar, macros, view tab.

Works: “I really like starter, and have gotten rid of works :-).”“It looks really cool, big difference from Microsoft Works.”

Compete: “I really like the concept of a free word / excel. Perfect for my dad, he is currently using OpenOffice.”

“With Starter edition there is no need for OpenOffice.”

Advertising: “If the ads remain in the lower right and the size used in the beta I think they are quite acceptable.”

User Feedback: Beta users have sent 1,552 pieces of feedback: 40% positive. 60% negative.



Starter’s Four “Non-Starters”

1. Missing Applications• 81% of people who prefer Office to Starter cite

apps that are missing, but needed.• 75% cite PPT. 49% cite Outlook.

2. Includes Advertising• 88% of beta user feedback on ads is negative• Ad intrusiveness was #1 bug in beta.• Longer time in doc, lower tolerance for ads.

3. Feature Removal• 94% of feedback on feature removal is negative• 2/3 of people say they need at least one removed

feature

4. Upsell Throughout the Client• Upsell prompts appear throughout the client

remind them what they are missing.• Ad space, ribbon, right pane, in-client prompts



Starter Marketing Guidance - Containment

Starter Marketing

OEM• Microsoft Advantage limits

Starter messaging and placement

• OEMs only authorize re-sellers to use approved messaging

SYSTEM BUILDER• Messaging requirements part of

System Builder OPK license• Starter Marketing execution

part of Co-Op program eligibility

MANAGED RETAIL• Tier 1 Depth Incentive Program

and Tier 1 & 2 MDF program include limits on Starter messaging and placement

UNMANAGED RETAIL• Restrictions pass through from

OEM only authorize use of approved messaging

We are supporting guidance with policy and investments to maintain consistent Starter messaging to reduce consumer confusion and clearly differentiate with full Office suites.



Starter Marketing Guidance Details

LIMIT AWARENESS

LIMIT CONSIDERATION

PURCHASE 2010

LIMIT PREFERENCE

STARTER MARKETING GUIDANCE

• Lead with and optimize for Office paid suite attach in all marketing touchpoints.

• When advertising PCs, reference the preloaded PC and purchase product key to activate instead of “Office Starter 2010.”

• When describing what software is shipping with PC (whether fact tag, specs or line list) use messaging framework to properly message the pre-loaded Office 2010 suite. Do not call out Office Starter 2010.

• Office Starter messaging must strictly adhere to core messaging frameworks.

• Office Starter should not appear in a SKU matrix or any comparison to full Office.

• Always refer to “Office Starter 2010” or “Word Starter and Excel Starter.”

• Any mention of “Office Starter 2010” should include the following: “This PC is preloaded with reduced-functionality versions of Word and Excel that include advertising. Purchase an Office 2010 Product Key to activate full-featured Office software on this PC.”

Call to action is “Purchase an Office 2010 Product Key to activate full-featured Office software on this PC.”

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