It is difficult to imagine a business that does not deal with electronic documents. Even the most brick-and-mortar enterprise, let’s say a janitorial-type venture, needs to track expenses and assets/inventory, maintain the client list, file tax returns, etc. The most popular software suite to deal with electronic documents is, of course, Microsoft Office. It is a de facto standard, and most businesses need to be able to handle Microsoft Word, Excel, and PowerPoint files in their communications with clients, suppliers, and/or regulators.

However, there are several drawbacks to using Microsoft Office:

1. It is rather expensive ($400 and more, for business users);
2. If you have several users/computers, you usually need to buy a licence for every installation;
3. If you change your computer, or operating system, you often need to buy a new licence;
4. Microsoft loves when its customers buy new versions of its software every two years, so it releases new versions that you need to pay for, and turns off support for old versions;
5. User interface (menus/toolbars/commands) changes every several years, forcing you to re-learn the same basic skills.

For example, a small business with just two employees, or a family, for that matter, with two desktops and two laptops, will often need to purchase four Microsoft Office licences to legally install the software on all computers, and then purchase new licences each time a computer is replaced. With average computer lifespan of about four years, this small business will need to pay out at least $400 to Microsoft, on average, every year, just for the office suite. Sounds like a tax, isn’t it?

Luckily, there are several free alternatives to Microsoft Office that will enable small businesses to substantially reduce their Microsoft tax.

It is safe to assume that most small businesses need to be able to work with text documents, spreadsheets, maybe view/prepare a presentation or two. Thus if you exchange documents with external parties only occasionally, you do not really need to have Microsoft Office installed on all your computers: you can use free alternatives for internal work, and keep one legacy system with Microsoft Office, in case you need it, for external communications.

So what are the alternatives? Although there are literally dozens of free or cheap Microsoft Office wannabes, only three are mature enough, both in terms of features and market acceptance, to be used by small businesses: OpenOffice.org, Zoho, and Google Docs. All three have a document editor, a spreadsheet application, and a package to design presentations, and are compatible with Microsoft Office to various degrees.

OpenOffice.org: this is an “installable” software package and it resembles Microsoft Office more than any other option. If you do not trust online alternatives and want to keep your documents locally, or do not have a permanent Internet connection, choose OpenOffice.org.

Zoho: the most sophisticated online office suite, and more. Offers a lot of advanced features not available in competing online services, such as document paging, references/footnotes, etc. As it runs in a browser, you do not need to install anything locally, and document sharing/collaboration is built-in. Of course, you need a reliable Internet connection to work with Zoho, and online security/privacy issues (to be addressed in a later post) should also be considered.

Google Docs: another online office suite. Not as sophisticated as Zoho, and thus often a preferred choice due to its ease of use (and the Google brand name). The same online-services’ pros and cons that apply to Zoho also apply to Google Docs.

More alternatives to Microsoft Office.

Even more alternatives to Microsoft Office.

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