Understanding Oracle's ODF Plug-in Pricing: What it Means for OpenOffice.org

Andy Updegrove may have cracked the code on Oracle's seemingly insane decision to start charging $90 for the formerly free ODF plugin for Microsoft Office. That's $90 in a minimum pack of 100, plus a 22% support fees for updates. Does Oracle really think that this will fly with companies, is Oracle trying to kill off the product entirely?

The ODF plugin was developed to allow Microsoft Office users to exchange documents with OpenOffice.org users. It works for spreadsheets, presentations, and word processing docs and Sun gave it away for years. So why has Oracle so suddenly decided to charge for it? Whatever Oracle's strategy, the company isn't talking. At first glance, it seems crazy, but Andy Updegrove has a theory that seems likely:

What does make sense is this: you can still download a copy of OpenOffice for free, and then use OpenOffice to open the document that comes over the transom. Then you can export it again as an Office-readable document. In short, you can get a 100 downloads of a complete office suite for nothing instead of 100 copies of just a plug-in for $9000. What would you do?

That's where the beauty of the plug-in price comes in. Now, instead of 100 users with a plug-in, you've got 100 people who discover how easy OpenOffice is to use. How easy is that? Much easier than you expect, particularly if you own a computer that uses a post-Office 2003 office suite, and hate it. When you download OpenOffice, you'll feel like you have your nice, familiar copy of Office 2003 back again — and for free. Now isn't that nice?

The number of businesses that use the ODF plugin probably isn't large enough to shift the user base of OpenOffice.org considerably, but it makes far more sense to download OO.org than to pay up for the plugin except for very large organizations. As Updegrove also points out, the potential revenues for the this plugin don't add up to significant revenue for Oracle, so the more likely cause is that the company sees a strategic benefit in making the change.

What's still troubling is that very little is coming out of Oracle in terms of what its plans are for OpenOffice.org itself. Updegrove's primary concern is ODF, but I'm more interested in its primary working implementation. Dealing with Sun as the primary mover behind OO.org had its pros and cons, but at least you could get some kind of answers out of the company. Oracle is, so far, doling out very little information. I've tried to get comments out of a few former Sun folks at Oracle and very little is forthcoming. That doesn't seem to bode particularly well for OpenOffice.org.

In the short run, the plugin pricing may be good for OO.org. In the long run, Oracle's stewardship may not be.