The days of buying Microsoft Office on physical media such as CD-ROM and DVD-ROM are numbered.

The new Office, as everyone from chief executive Steve Ballmer down is calling it, will be available on physical media but Microsoft is expecting most sales will be made online with customers downloading the software and activation code from Microsoft's Office.com website.

The new Office includes Office 2013 products and Office 365 products, all of which include new versions of Office essentials such as database program Access, spreadsheet software Excel, notetaking app OneNote, email client Outlook, presentation viewer PowerPoint, desktop publisher software Publisher and word processor Word.

Microsoft is also breaking its three-year release cycle on new versions of Office by updating the software, which already has in excess of 9000 features, via an internet connection.

The move will offer anyone with a valid subscription the ability to have the latest version installed on their machine. It's akin to the model security software vendors have used for years designed to ensure computers always had protection from the latest online nasties, especially viruses, and are bang up to date.

The software giant has released a new version of Office on CD-ROM or DVD-ROM every three years since it was launched in 1989.

Kurt DelBene, president of the Microsoft Office Division, said the change in the way Office was delivered was a major leap forward.

"People's needs change rapidly, and Office 365 Home Premium will change with them."

Microsoft doubled its efforts with the new Office, available in various versions, with twice the normal resources put into it.

The new version has a completely new streamlined user experience. It does everything the previous version does and more, but feels less cluttered in the process.

Let me put it another way: Microsoft has redecorated Office.

For an annual subscription of $165, you get an Office 365 Home Premium key, which enables the download of the software to up to five different PCs and Apple Macs and access to the suite of Office apps and your files via a web browser from anywhere with an internet connection.

Microsoft has also added two modes which you can toggle between. Mouse mode is the traditional mode for Office users on a more traditional PC and Touch mode is for those using their fingers on a touch-enabled computer.

It comes with 20GB of free storage on Microsoft's virtual hard disk drive, SkyDrive, which enables you to store files in Microsoft's cloud and access them from any machine.

Office 365 runs on Windows 7 and Windows 8 PCs as well as Mac OS X version 10.5.8 and above.

There's also Office 365 University, Office Home and Student 2013, Office Home and Business 2013 and Office Professional 2013.