Cantillon: Apple’s free software marks escalation in battle with Microsoft

Apple’s decision to give away its productivity software free of charge to customers may have passed by most people on Tuesday night with barely a raised eyebrow.

After all, the company was busy dazzling onlookers with thin tablets and high-definition screens.

The software move marks an escalation in the war between it and Microsoft, and a move on Apple's behalf to bring the battle it has been waging – and winning – in the devices market to the desktop. Its Mac operating system and iWork software suite, which compete with Microsoft's Excel, Word and other applications, will now be offered free to all users.

By giving away its Mac operating system, Apple is taking on Microsoft's predominant Windows platform, one of its most profitable cash cows.

When it comes to user numbers, Apple’s Pages pales in comparison to its rival Word. Despite the availability of free versions from rivals, Word is familiar and it is ingrained in many users to automatically opt for it.

Yet Microsoft may find itself in a diminishing market as the appetite for paying for productivity software dwindles and its rivals up their game. Although the company is moving more towards cloud software with Office 365, the cost of such subscriptions may increasingly deter consumers in a competitive environment.

However, the death knell for Microsoft Office as a paid product shouldn’t be sounded just yet. Call it nostalgia, call it habit, but despite the availability of the aforementioned free software – including Google’s own online offering – Office 365 has apparently managed to become a billion dollar business in its first year.

Further evidence of its more aggressive approach to rivals such as Microsoft can be seen with the decision to finally break with its tradition of charging for upgrades to the operating system, with the news that the Mavericks update will be given to OS X users free of charge. That’s a move out of Microsoft’s playbook.