How to get Office 2010 at a rock-bottom price

If you're considering an Office 2010 upgrade, be sure you learn the lesson of Windows 7. Microsoft offers its best prices to early adopters. Those who wait pay more.

Here's a recap of what you could have taken advantage of last summer, after Windows 7 was released to manufacturing but before it was available for retail sales. Microsoft offered "screaming deals" on upgrades ("a special, time-limited offer")—a  mere $50 for Windows 7 Home Premium and $100 for Windows 7 Professional. There was also a three-license Family Pack of Home Premium for $149 that sold out about six weeks after the retail launch date, and a special $30 upgrade offer for college students ended around the beginning of the year.

None of those deals have been repeated. Those who waited paid more. The current prices for retail upgrade versions of Windows 7 Home Premium and Professional at Newegg.com are $110 and $176, respectively.

So what's the best price you can get now on Office 2010? The biggest wrinkle, as I noted in my Prices, packaging, dates, and other details post, is that Microsoft has dropped upgrade prices completely. One price fits all in the Office 2010 era. So the challenge now is to seek out the best current price and then decide whether you'll be able to do better.

Your best friend in this process is the Office 2010 Technology Guarantee program, which qualifies you for a free update to Office 2010 if you buy Office 2007 today. There are some great deals to be found there because of some quirks in the transition to the new line-up. (With Office 2010, Microsoft has dropped the Ultimate and Enterprise editions and the OEM-only Basic edition. As a result, the upgrade matrix has some interesting bargains.)  I'll get to the rules and restrictions of the Tech Guarantee program on the next page, but first, here's how to shop smart. (Note: All details are extracted from this FAQ page and apply only to the United States.)

Update: In the Talkback section, a reader points out the "Military Appreciation" edition of Office Standard 2007, which costs $70 and can be upgraded free via the Technology Guarantee to Office Home and Business 2010. More details are here.

If you want Office Professional 2010…

Est. retail price: $499 full/$349 key card Best deal today: $237 (Newegg) Savings: 32-53%

You can buy any version of Office Ultimate 2007, Office Professional 2007, or Office Small Business 2007 today and you qualify for an upgrade to Office Professional 2010, which is the top of the Office 2010 retail line. (There is no Ultimate edition in the Office 2010 family.)

Assuming you already own a qualifying edition of Office, the best deal to be found is an upgrade package of Office 2007 Small Business Edition. I found it for $237 at Newegg. That includes the right to install on a primary PC and a secondary, portable PC. If you don't qualify for an upgrade, the selling price for the full version is $370.

If you want Office Home and Business 2010…

Est. retail price: $279 full/$199 key card Best deal today: $199 (Newegg) Savings: 0-28%

This version is ideal for small businesses and includes Outlook. Either Office Standard 2007 or Office Basic 2007 qualifies for an upgrade to this edition. However, Office Basic is only available as an OEM product, so through the retail channel you're stuck with Standard edition. I found the upgrade version at Newegg for $200. That's the same price as the key card but includes two installs.

If you want Office Home and Student 2010…

Est. retail price: $149 full/$119 key card Best deal today: $100 (bhphoto.com) Savings: 0-33%

If you buy a retail copy of Office Home and Student 2007, you qualify for an upgrade to the equivalent version of Office 2010, which can be installed on up to three PCs in a single household. I've seen sub-$100 prices on the 2007 version in the past, but the best I can find today is $120 from Newegg. (And that's for the full edition; the current Home and Student lineup does not support upgrades.) [Update: A rep from B&H Photo advises that they have the product in stock for $100.] That's a discount of 33%. And don't be fooled by the discount on the key card. It is not a good deal That key card is good for only one installation, whereas the retail box permits three installs.

Next: Awesome student discounts, disappointing OEM prices -->

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If you are a student…

Est. retail price: $499 full/$349 key card Best deal today: $60 (Microsoft, download only from Digital River) Savings: 83-88%

If you're enrolled in college or university in the United States (ideally with a .edu e-mail address, although you can establish your eligibility otherwise), taking as little as 0.5 credits, you get the smokin'est deal of all. Microsoft's Ultimate Steal gets you a perpetual license to Office Ultimate 2007 for $60. You can then upgrade to Office Professional 2010 (the equivalent edition) for free when it's available this summer.

The conditions for the Ultimate Steal offer are listed here. The deal is good through December 31, 2010. The terms listed on that page say the offer is non-transferable, but the product that is ultimately delivered is a retail license that can indeed be sold or given away. If you have a college student in the family, make sure they're aware of this offer.

If you're an enterprise customer...

My colleague Mary Jo Foley wrote about deals for volume license customers back  in early January. The Microsoft "Up to Date Discount" program runs through June 30, 2010, and offers savings of up to 50% for volume license customers. According to that report, the cost for a U.S. customer who signs up for the program “would be ... $91.00 for Office 2007 Professional Plus in year 1, plus receiving all of the Software Assurance benefits (such as an automatic upgrade to Office 2010 when it launches, Office Home Use Rights, and much more) for that price.”

If you plan to buy a new PC…

You can buy an OEM copy of Office 2007 when you purchase with a new PC. These copies qualify for the free upgrade to the matching version of Office 2010 as well. This strategy works best with configure-to-order PC makers like Dell, which include Office as an option. If you buy a preconfigured system from a retailer like Best Buy, this option might not be available to you.

However, when I priced out new notebook and desktop PCs at a couple of online retailers, including Dell, I found inconsistent results. The notebooks at Dell offered higher prices on Office 2007 Basic and Small Business than you would pay for a shrink-wrapped copy—and since they allow only one install, that doesn't seem like the right way to go. At HP, on the other hand, I found Office Basic as an add-on for $119, which qualifies for an upgrade to Office Home and Business 2010 and is a better deal than you can get with a shrink wrapped package.

If you have a TechNet, MSN, or Action Pack subscription…

Office 2010 will be available through all of these sources under the usual license conditions. If your intended usage qualifies, you can get full versions of most Office editions as part of your annual subscription. The MSDN and TechNet licenses are perpetual, meaning you can continue using them even if you don't renew next year. The Action Pack subscription is less restricted in usage rights, but the license is no longer valid if you fail to renew your subscription.

For more details on MSDN and TechNet, see this write-up from last fall. For details about Action Pack eligibility and restrictions, see this write-up from earlier this year.

The Fine Print…

So how do you qualify for one of these upgrades? The full rules are here. Although I've provided a summary below, it is not comprehensive and you shouldn't rely on it without doing your own due diligence.

• You have to buy a qualifying Office 2007 product (with or without a new PC) between March 5, 2010 and September 30, 2010. The full list of qualifying upgrade products is here. Office 2003 and Office:Mac (any version) do not qualify.
• You must install and activate your copy of Office 2007 by September 30, 2010. Do not put it on the shelf.
• You must request your upgrade by October 31, 2010, using the 25-character Office 2007 product key and a dated sales receipt.
• Upgrades are limited to 25 per person.
• The upgrade will be available for download at no cost or you can purchase a DVD at an unspecified (but presumably nominal) cost.

Eventually, you'll also find Office in OEM System Builder packages and in academic outlets. The rules for OEM copies of Office are very strict, much more so than with Windows. I don't recommend buying those shrink-wrapped OEM Office copies. Academic copies are usually a great deal, as long as you read the rules carefully and make sure you qualify.