So you want to buy Microsoft Office 2010; What is this Product Key Card “PKC” thing anyway?

Woody Walton

Since before the release of Office 2010, Microsoft has been preparing the channel for a new or updated purchase mechanism for Office that gives consumers a safe, easy, and inexpensive to get into the Office 2010 Suite when they buy a PC or shortly thereafter one would hope.  The problem is that there are still many consumers and likely as many partners that don’t fully understand the offering.  …So let’s start at the beginning.

The purchase mechanism is called the Product Key Card, hereafter referred to as PKC.  It is similar in appearance to the medialess license kit of prior versions of office, but there are some differences.

Unlike retail packaged product one would buy online or a local merchant, the PKC does not contain installation media; No DVD!  It relies on the OEM (original equipment manufacturer), or computer manufacturer to preinstall a single image on the computer that contains the software for all the retail versions of Office 2010 (Office Home and Student 2010, Office Home and Business 2010 and Office Professional 2010).  If the single image is there, the only thing a customer need do is buy the PKC for the version of Office 2010 they require and use the product ID contained inside the PKC to install and activate the product.

So to help guide the customer, the sales person (partner) must know which machines they are selling that contain this single image, right?  Right, kind of.  MOST systems shipping today have the single image pre-installed.  In fact I was training a large national retailer earlier this month and they told me every SKU they have in stores will have the single image pre-installed shortly, across all brands.  It does help if you know for certain, as you are supposed to be trusted, right.  …Have this is your back pocket though. IF you do sell a PKC to a customer who purchased a system without the single image pre-loaded, it can be downloaded.

http://office.microsoft.com/en-us/buy/using-the-product-key-card-FX101853163.aspx

Notice the Green button on the bottom marked download!

A few pointers…

If You are Building a PC:

Install the Single Image using the OPK tools and clearly identify the PC as pre-loaded in the PC spec

Sell the appropriate Office PKC to unlock the Image

If You are Reselling a PC from another OEM:

Determine if the PC has Office single image pre-loaded and sell the appropriate Office PKC

If Office single image is not pre-loaded sell the appropriate FPP (Full Packaged Product, i.e. Retail)

 

The question of significance, however, is whether the PKC is the right choice for your customer.  It has some advantages.  Lets discuss them.

Lower cost is perhaps the biggest reason to consider the PKC. When compared to retail copies of Office 2010 it comes in around 15-30% less than the equivalent retail version.

 

The table below shows the current web prices as of today for a large web retailer for the retail boxed product and the PKC.  (THIS IS NOT MSRP, but actual prices).

Office 2010 Version	RETAIL	PKC
Home and Student	$139.99	$116.99 (~16% savings)
Home and Business	$242.99	$179.99 (~26% savings)
Professional	$473.99	$334.99 (~30% savings)

The savings increases the higher you go up the SKU stack with Office 2010 Professional offering a savings in real dollars in this example of $139!!

Who wouldn’t want to save $139.00?  Nobody, right?  …well, as you probably guessed, the devil is in the details.  The PKC may be a great way for you to help your customer save money, but make sure you are comparing apple to apples.

The PKC is limited in that it can be installed on one PC only, very similar to our traditional OEM Office SKUs in the past.  The traditional retail versions of office have options for multiple installations potentially saving money over PKC in certain scenarios. A paste below from the Office PKC FAQ confirms this.

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How many licenses /installations do Office Product Key Cards allow?

Each Product Key Card allows one user to activate one Office 2010 suite on one preloaded PC.

How many licenses /installations are allowed with the traditional Office discs version?

The number of installations will vary depending on the Office suite purchased. The disc version of Office Home and Student 2010 allows a user to install one copy of the software on up to three PCs in a single household for non-commercial use. (Office Home and Student 2010 cannot be used for any commercial, non-profit or revenue generating activity or by any governmental organization.) The disc version of Office Home and Business 2010 and Office Professional 2010 allows one user to install one copy on one PC and a second copy on his/her portable device such as a laptop.

reference:  http://office.microsoft.com/en-us/buy/office-product-key-card-frequently-asked-questions-HA101847520.aspx

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Therefore, when we take a consumer customer example where a family has two laptop PCs and one desktop PC, we see clearly that the retail version of Office 2010 Home and Student comes out way ahead even though the PKC is cheaper.  Using the prices above $139.99 is quite a bit less than $116.99 PLUS.  If the customer were buying all three systems at the same time (unlikely), they could opt for 3 PKCs (total of $350.97).  More than likely they already have a least one of the PCs.  If ANY other PC does not have Office and another copy will be needed, the retail SKU just became the best choice.  Another reason is that should the family buy  new PC next year, they could transfer one of the retail installations of Office 2010 Home and Student to the new PC. The PKC does not have this versatility.  It is cheaper, but with limitations.

In a small business or professional scenario where the customer has a laptop (portable device) and a desktop, they clearly save with Office 2010 Professional retail version. The total would be $473.99 in our pricing, rather than $669.98 ($334.99 twice) for PKC.

If a business is purchasing several new PCs neither retail or PKC may be the best choice.  Remember, we have another tool in the tool bag; Volume License!  Microsoft’s licensing programs such as Open Value, Open Business, etc.  offer savings over retail pricing for larger purchases.  They also confer the same or better transportability rights as they are not tied to the PC.

Make certain you run the numbers before automatically assuming any particular SKU is the best fit.

 

I hope this was helpful.

 

Regards,

 

Woody Walton