How will Microsoft use Office?
Rumor has it Microsoft will launch Office for iPad as early as November of this year. The company might even have plans to build a version that can run on the Android operating system. While it made sense for Microsoft to provide Office for iOS, I am not sure it should go the same route given the mobile landscape and its place in it. It seems that, in addition to the synergy Xbox can provide across devices, Microsoft's other edge over Apple and Android is the widely used and generally well-liked Office suite. In fact, Morgan Stanley ( MS) analyst Kathryn Hubert expects Microsoft to surge past Android for the No. 2 spot, behind Apple, in the tablet market once Windows 8 hits the streets. The difference maker, according to Hubert: Office. With that in mind, I simply do not see the sense in making Office available on the competition's mobile operating systems. It's one thing to do this during a time and in a space (computers) where you compete from a position of strength. But that's hardly the case in mobile; Microsoft needs every advantage it can get as it looks to challenge Apple and Google, let alone take second or, less likely, first place.
How I am Playing It
If Microsoft keeps the mobile version of Office for itself (it's a no brainer!), I will become ultra-bullish. Ultra bullish means the stock might become one of my top holdings. Everybody uses Office. Most people use it on a PC. The ability to sync the work you do in Office with mobile devices -- and to maybe even pull it up on your television screen via an Xbox Live account -- could break the game. That's why it's a no-brainer. In any event, with or without Office as an exclusive weapon, I still like the odds that Microsoft wins the living room and, at a minimum, makes some meaningful noise in mobile with the Windows 8/Xbox combination. I tend to think it will do more than make noise; expect Microsoft to disrupt the space going forward. I am long MSFT January $30 calls. I intend to add to this position on any dips related to broad market weakness. No matter what happens in Europe or on a macro level in the United States, I anticipate the story Microsoft is writing at the moment to play itself out as what could be one of the few bullish narratives in another otherwise topsy-turvy market. Expect to see me in some at-the-money MSFT January 2014 calls as well before the year is out. This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.