Microsoft is taking the wraps off its most ambitious Office project today. The software giant, synonymous with Office and Windows, is aiming to turn users over to a subscription package with its latest offering: Office 365. It's an important change for the company, but convincing users to pay an ongoing monthly or annual charge for its latest Office is going to be a hard sell, and the company is very much aware of that — treading carefully in its march towards the cloud.

A boxed copy won't include a DVD, it's online only

Starting today, boxed copies of Office 2013 and Office 365 subscriptions will be available in retail stores across 162 countries and online at Office.com. However, there's a big change this time: in the US, UK, and other developed markets, those boxed copies won't include a DVD of the software. Microsoft is simply boxing up product codes in familiar packaging for Office 2013 and Office 365, allowing users to go online to download the software. Some emerging markets will still offer DVD versions, but the majority of users will be downloading Office this time around.

Much like Windows 8 and Adobe's Creative Cloud, Microsoft is attempting to reinvent its Office software for 2013 and the years ahead. A $99.99 per year subscription to Office 365 will provide access for five installs of Office 2013 on Mac or PCs with access to Word, Excel, PowerPoint, OneNote, Outlook, Publisher, and Access. Microsoft is also bundling 20GB of additional SkyDrive cloud storage and 60 minutes of Skype calls per month. If you're not a fan of annual subscriptions then the monthly option is $9.99 or there are standalone bundles. Office Home & Student 2013, separate to a subscription and available at $139.99, only includes Word, Excel, PowerPoint, and OneNote — nixing the popular Outlook email software found in the subscription package. The top-priced bundle, Office Professional 2013, costs $399.99 and includes access to all of the software provided in Office 365.

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The pricing is a clear effort to convince users that subscribing to Office is cost effective, and Microsoft will also throw in free upgrades to the latest Office software when it becomes available as part of the subscription. If you're a heavy Office user, particularly with a number of devices you need to use the software on then the Office 365 subscription makes a lot of sense. The choice of standalone vs. subscription leaves consumers with a choice between two worlds.

Microsoft bets on a future of subscriptions and the cloud

Microsoft is betting on the cloud world here. The company knows people are familiar with boxed copies of Office, so it's keeping the containers around in order to gently guide consumers over to the new subscription-based world. A new on-demand version of Office 2013 is available in Office 365 and it's nothing short of stunning. You simply sign in to Office.com and start streaming a version of Office 2013 on a Windows 7 or Windows 8 computer without it affecting an existing installation of Office on the machine. It's great if you're away from your PC and need more power than the existing Office Web Apps, but it should also ease enterprise adoption and the tricky mix of managing legacy documents and add-ins vs. rolling out new software to corporate PCs. Technically, it uses Microsoft's Click-2-Run technology which means it can sandbox the install and make features available instantly while it's downloading the full Office package in the background. I've been testing it for months and it will allow you to start running a full version of Word instantly, offering up immediate access to popular formatting options. It's a really smart part of Office 2013 and a massive departure from previous versions.

Speaking of the cloud, the backbone of Office 2013 for home users is undoubtedly SkyDrive. Microsoft has included support to directly save and open from SkyDrive, meaning it's even easier to share and edit documents regardless of what PC you're using. The same applies to mobile here, there are OneNote clients for Windows Phone, iOS, and Android. Windows Phone also offers the ability to view and edit Word, Excel, and PowerPoint documents. Microsoft isn't discussing its plans for full versions of Office Mobile for iOS and Android just yet, but they're on the way and they'll likely tie into the Office 365 subscription.

Like Windows 8, Microsoft is reinventing itself again

Underlying Microsoft's latest Office effort is a sense of ambition to convince consumers that subscriptions and the cloud are the future. It doesn't seem as risky as Windows 8, thanks to the standalone version availability and look and feel, but it feels similar. Office, like Windows, is caught between the two worlds of traditional software vs. the mobile cloud-based future. Microsoft is investing a lot here and it needs to. With Google hot on its heels and trying to break into the enterprise, Microsoft has taken the opportunity to step into the unknown as part of "a fundamental shift" towards a devices and services company.

It's enough if you're a Windows user, but the real test for Office will be on mobile. This generation is simply a desktop app, but iOS, Android, and even Windows 8 will require fully touch-based versions in the future. There's hints at radial menus and touch-based productivity in the OneNote Windows 8 app, but that's a small part of the overall Office package. If Microsoft is truly ambitious, then a future of cross-platform mobile optimized apps combined with the cloud is the future of Office and today is just a hint at things to come.