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Computerized Investing > Fourth Quarter 2013

Excel 2013/Office 365 Home Premium

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by Wayne A. Thorp, CFA

Microsoft Office is arguably the most popular productivity suite in the world today. Except for using Novell’s WordPerfect or my Brother word processor during my undergrad days at DePaul University, Microsoft Word has been my go-to word processing application. The same can be said of Excel for my spreadsheet work (all of the templates I produce for this column are made with Excel), PowerPoint for my presentations and Access for my database work. However, in recent years, Office has seen competition arise from OpenOffice, a free, full-featured productivity suite from Apache, and online/cloud-based alternatives such as Google Docs.

In the face of the changing computing landscape, Microsoft has deviated from history with the release of the new version of Office (Office 2013 for Windows and Office for Mac 2011) and embarked on a new business model for the package: a streaming subscription service. (While more traditional versions of Office 2013 are available with a pay-once, use-forever license, our focus in this article is on the cloud- and subscription-based version of Office 2013.) After using the service for a few months, I found that although the functionality of the underlying office apps (Word, Excel, PowerPoint, etc.) hasn’t changed that much, the way in which users access the programs and interact with files, documents and even other users has undergone a profound change.

In this installment of Spreadsheet Corner, I discuss the fundamental changes that have taken place with Office 2013 as well as some of the new features available with Excel 2013.

Subscription Service

In years past, if you didn’t buy a PC with Office pre-installed on it, you would purchase a CD or DVD that you’d use to install Office on your computer (or download it directly from Microsoft). You would also get a product or license code that activated the software, giving you access to all of its features.

With Office 2013, Microsoft has shifted from selling a product to offering a service. As such, it has renamed the package Office 365. The 365 moniker comes from Microsoft’s online services for business, and serves as the first indication of something new from Microsoft’s workhorse.

With Office 365, however, Microsoft didn’t manage to shrug off its need to have several versions of a given product. The vast majority of those using Office at home will opt for Office 365 Home Premium, which includes Word 2013, Excel 2013, PowerPoint 2013, Access 2013, Outlook 2013, OneNote 2013, and Publisher 2013 (Office for Mac 2011 has a more limited lineup: Excel, Outlook, PowerPoint and Word). For college students and faculty, Office 365 University supplies all the same applications as Home Premium. There is also a dizzying array of Office 365 versions for business and enterprise applications; suffice it to say, one of these is the route you would take if you use Office for “commercial, non-profit, or revenue-generating activities.”

Because it is a subscription service, you no longer pay a one-time fee for Office as you did for previous versions, which typically ran into the hundreds of dollars for a single license. This, in turn, gave you the right to install the software on a single computer. With Office 365, you now pay a monthly or annual subscription fee. Office 365 Home Premium costs $9.99 a month or $99.99 per year, while Office 365 University is expected to run $79.99 for a four-year term. Also new with Office 365 is the ability to install the software on multiple systems, simultaneously. Office 365 Home Premium can be installed on up to five PCs or Macs as well as up to five mobile devices. Similarly, Office 365 University can be installed on two PCs or Macs.

Also be aware that, as with any other subscription, if you cancel Office 365 or fail to renew it, you can no longer use Office 2013/Office for Mac 2011. The programs drop into what Microsoft calls “read-only” mode,” which means you can still open, read and print documents, just not create new ones or edit existing ones. However, you will still be able to edit existing Office documents using free apps for Office (more on those later). An expired Office 365 subscription also means you don’t get the extra 20G of SkyDrive cloud-based storage, which comes with Office 365 (more on that later, too.)

Head in the Clouds

Microsoft is rarely considered to be on the forefront of innovation. However, the company was actually one of the first cloud storage providers when it launched Windows Live Folders in August of 2007. Over the years, the service has evolved into SkyDrive, a cloud storage and file syncing service. This work on cloud-based computing laid the foundation for another key element of Office 365—cloud integration. With Office 365, you can edit Office documents virtually anywhere—on a Windows- or Mac-based computer, Android or iOS smartphone or tablet, or in a Web browser.

Office 365 is about as cloud-based as it can be without running exclusively on the cloud. You first download an installation “stub” from the Web that, in turn, triggers a “streamed” download that installs the key components of Office on your computer for on-demand access. By default Office will open its apps using this streaming methodology, but you don’t have to have an Internet connection to use any of the Office apps. Keep in mind, however, that you do need an Internet connection to install Office 365.

Office 365 is tightly integrated with several Microsoft online services, including SkyDrive and Skype. Furthermore, assuming you use a Microsoft account when logging into the software, your personal settings and preferences will follow you from system to system.

Another new feature with Office 365 is “Office on Demand.” This functionality allows you to “stream” a copy of Office 365 Home Premium to a PC for temporary use. Office will install the required components needed to run on the system and then fully uninstall when you close the program.

Compatibility, Installation & Getting Started

Before you go out and buy Office 365, be sure to check the system requirements. Microsoft created more than a little controversy when it announced that Office 2013 for Windows users is only compatible with Windows 7 and Windows 8. For those still running Windows XP, that venerable operating system reaches its end of life next year, so it’s not too surprising that Office 2013/Office 365 doesn’t support it. However, it is apparent that Microsoft is choosing to look past the Windows Vista “debacle” and focus on Windows 7 and Windows 8 exclusively. Without a doubt, this is also an enticement to upgrade from older versions of Windows.

If you are running a Windows XP, chances are it’s time to upgrade to a new computer and operating system. Windows 8 and its radically redesigned interface, however, was a bit of a shocker and took some getting used to. On systems that do not support a touch display, I don’t see Windows 8 as being much use. However, since I have been using the Microsoft Surface Pro touchscreen tablet, I have come to appreciate this operating system more and more.

Office 2011 is the latest Mac version of the suite and is compatible with Mac OS X 10.6 or later.

You can purchase Office 2013/Microsoft Office 365 from a variety of outlets, including brick-and-mortar stores such as Best Buy and online via outlets such as Amazon.com. This will, in effect, give you a website from which to download the software and a license key to activate your subscription. You may also buy a subscription directly from the Microsoft Store at www.microsoftstore.com. For instant downloading, I didn’t find any price differences online, while there was some minor discounting for a key card that is sent to you (although this takes longer for you to get started using the software).

I purchased my Office 365 subscription via the Microsoft Store. If you purchase it there, you have the option of setting up a Microsoft account, which is the new name for the former Windows Live ID. You can use this account to sign into services such as Hotmail, Messenger, SkyDrive, Windows Phone, Xbox LIVE, or Outlook.com. I had already set up a Microsoft account when I installed Windows 8 on my first system, so I used it when signing up for Office 365. You use this to log into your Microsoft account, which also unifies your files via SkyDrive and your personal settings across the different platforms on which you use Office 365 (more on this later).

Signing up for a Microsoft account will also let you keep track of how many of your five installations of Office 365 Home Premium you have used. At the Office website (office.microsoft.com), you can see the names of all the PCs or Mac systems you have installed Office 365 on and when you installed the software on each system (Figure 1). From here you can also deactivate an installation and have installation instructions sent to a mobile device.

Once you have your subscription for Office 365, the next step is to install it. You begin by downloading a 558K “stub” file that, when run, launches the file Microsoft Office ClicktoRun, a streamed download that collects the various components of Office 2013 on-demand and installs them in a virtual file system using Microsoft’s application virtualization technology (in effect, giving you the option of running the program locally from your PC or via the cloud/Internet). This also allows you to install Office 365 on a system that has a previous version of Office without the older version being overwritten.

The menu-driven installation process begins by asking if you wish to sign in using your Microsoft account. Again, this isn’t mandatory, but it enhances your experience by allowing you to save files in the cloud with Microsoft SkyDrive, giving you access to them from virtually anywhere, and having your personal settings follow you to different systems. The installation continues on through several additional menu screens, including one where you can choose a background for your Office programs. The menu also offers a guided tour of the new features in Office 2013. It’s not a bad way to pass the time while the program is installing in the background, so I suggest you take a look. It took about five minutes from the time I ran the initial “launcher” to when I was able to run an Office program.

Apps for Office

Microsoft now has two flavors of its Office apps: the full-featured programs that exist natively on your computer and a collection of apps for Office that allow you to open Office documents from virtually anywhere. There are apps for Word, Excel, Outlook and PowerPoint (Figure 2).

An app for Office is essentially a Web-based version of the Office client program, albeit somewhat watered down. The apps can run in multiple environments and platforms, including desktop clients, mobile browsers and mobile Web browsers. While you don’t always get the same level of functionality you would get running the native program on your computer (this is especially the case with Excel documents), at a minimum you can open and view an Office document from pretty much any platform with an Internet connection. According to Microsoft, Office Web Apps are officially supported in Web browsers Windows Internet Explorer 7 and later, Chrome, Safari 4 and later for the Mac, and Firefox 3.5 and later for Windows, Mac, and Linux.

SkyDrive, Sharing & Collaboration

Office 365’s cloud integration lets you save documents to its SkyDrive cloud storage service (for more information on cloud-based file storage and syncing services see my May 2013 Online Exclusive, available at the Computerized Investing website). A subscription to Office 365 Home Premium gives you 27G of storage (seven free gigabytes plus an additional 20G). By default, Office 365 will save files to SkyDrive, assuming you have signed into the suite using a Microsoft account. However, using the “Save As” option, you can save files anywhere you want, locally or to the cloud. You can also change this default through the Options menu in any Office app.

By going directly to the SkyDrive site (www.skydrive.com), you can see all the files you have saved to the cloud, grouped by Documents, Pictures and Public (Figure 3). You have a number of options when working with files within SkyDrive by right-clicking on any of them. First, if the file is an Office document, you can choose to open the file using the native Office program or open it using the related Office app. Using the Office app means that even if you are at a computer without Office installed, you can still open, edit and save existing Office documents.

SkyDrive also allows for collaboration and file sharing. By right-clicking on a file you can email a link to one person or a group of people. If the file is an Office document, the recipient will be able to open it even if they don’t have Office installed, again using the browser-based Office apps. You have the option of allowing recipients to edit a file or view it as “read only.” You can also post documents to social media (Facebook, Twitter or LinkedIn), again giving others the ability to edit the document.

With SkyDrive and the Office Web Apps, multiple people can be “co-authoring” or editing the same file at the same time. One drawback is that, as of now, real-time co-authoring doesn’t exist. This is a feature available with Google Docs, whereby changes made to a document by more than one person at the same time show up immediately. Currently with Office 365, when multiple people are editing a shared document simultaneously, changes only show up when one of them saves the document. Microsoft hasn’t given a definitive timeline on when this feature might be available, but its addition will significantly improve the collaborative element of Office 365.

Excel 2013

As Excel is the world’s most popular and perhaps most powerful spreadsheet program, any changes Microsoft rolls out for it at this point are incremental at best. However, several enhancements have been made to Excel 2013 that are worth mentioning. If you have been using Office 2010 and its infamous “ribbon” tool bars, that hasn’t changed with Excel 2013. The font and icons have undergone some tweaking, giving the whole thing a bit more of a Spartan feel and, in my opinion, making it more pleasant to look at (Figure 4). There is a new Start screen that lists the most recently used workbooks and a link to open other workbooks from either a local disk or the cloud. Here you will also find several pre-built templates to choose from or you can open a blank workbook. On the finance side, templates include a loan amortization schedule and personal monthly budget. If you don’t find the Start screen useful, you can disable it.

When opening multiple workbooks at the same time, Excel finally opens each one in its own window, with its own ribbon toolbar. To me, this is a significant improvement over having separate panes open in a single Excel window as in past versions. Having a separate window for each workbook is especially nice for those who work with multiple monitors.

The new Quick Analysis data visualization tool is something spreadsheet novices and pros alike will appreciate. It allows you to easily and quickly convert data to a chart or table in only a step or two; you can also preview charts to see which one works best, similar to previewing text styles in Microsoft Word 2010 and 2013. When you select a block of data, click on the Quick Analysis icon that appears and Excel displays a gallery of suggested formatting, charts, etc. For PivotTable users, Quick Analysis also suggests possible pivot tables, making this somewhat daunting function more accessible to the typical spreadsheet user.

Finally, the new Flash Fill feature has the potential to save you a lot of time, depending on the data you are entering in your worksheet. With Flash Fill, Excel analyzes your data and what you are entering and tries to anticipate what you want to do. As an example, if you have a column of full names and wish to extract the first name into a separate column, you can enter the first name of a person and use the Flash Fill feature to extract the first names from each cell in that column.

Excel 2013 also has nearly 50 new functions, but only one function pertains to finance.

Conclusion

Microsoft has a challenge on its hands as it tries to improve upon its leading productivity suite. It risks alienating existing customers, especially when there are more alternatives on the market, including OpenOffice. With Office 365, Microsoft has turned its Office business model on its ear. The company has moved away from the pay-once/install-once model it has followed for years to a subscription-based model that allows users to install the software on multiple systems. As someone who uses several computers on a regular basis, I find this a tremendous help. The new apps for Office are also a great way to at least view Office documents from a computer that doesn’t have Office installed on it, if not actually edit or create new content. Equally useful is having Office documents on a mobile device using these Web apps.

Excel 2013 doesn’t have any truly earth-shattering changes from Excel 2010. However, considering all of its enhancements as a whole, including Quick Analysis and Flash Fill, you have an analysis tool that has become easier to use, especially for spreadsheet novices, and one that is “smarter” when trying to predict your needs.

Some Windows users will predictably grumble about Office 365 only being compatible with Windows 7 and Windows 8, while Mac users will probably be pleased they haven’t been left out. If you are using an older version of Office (pre-2010 on Windows or pre-2011 on the Mac) and are thinking of upgrading, Microsoft Office 365 Home Premium is well worth a look.


Discussion

Peter Asprey from WA posted about 1 year ago:

Another great article, Wayne. But removing the MDI (the ability to open many spreadsheets and have only one ribbon/toolbar is a great loss to me. I also use multiple monitors, but found I could ALWAYS open a separate copy of Excel if I needed it. What we lost is the ability to size and put lots of spreadsheets together. AND, it is MUCH slower to copy paste, and even open lots of spreadsheets. At the least, they could have left it an option.

Other than that, everything you wrote about makes great sense. I prefer the subscription model; it keeps everything up to date and five copies for the price of one ($99 a year for me) is a great deal! Hope it stays that way.

A note about Win 8. I HATED it at first...until I found out how to keep the good stuff and turn off the touch screen stuff. MS SHOULD have a button to do that! Still, there are some great features. Particularly the search feature in "charms." I can FINALLY find anything and everything quickly in my jumble. I've almost stopped using the icons on the desktop at all...

Finally, SkyDrive has become valuable to me to, but for a different reason. I have a blog that often references spreadsheets, especially those that use "Filters." Now my readers, no matter what the platform or browser (within reason) can open the spreadsheet in their browser, and set the filter conditions. MUCH better than downloading spreadsheets when someone is "quick looking." You can look at one of these here if you're curious: http://www.sundognorth.com/TtP-S/?p=3468

Again, I appreciate your well written and researched articles! Another dividend from my lifetime membership.

Pete Asprey
Bellingham, WA


Nelson Rodriguez from al posted 8 months ago:

Great article Wayne, describes very well what Office 365 is all about. I also like the subscription terms and price.


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