While Office fans will likely welcome this app addition to the Google Play store, there's a slight catch: the app is free to download but will only work for subscribers to Microsoft's Office 365 Home Premium and ProPlus service.

I think this is another epic fail.
In the sense that won't give them any revenue from the bulk of Android users (that I really doubt that have Office 365, likely have some Office between 2003 and 2013), and none will pay 100$ per year for an app.

I suppose Microsoft had to offer it,
I myself am contemplating my next device as an Android of some type, freaking iphone ios 6 has not improved anything touch interface is actually worse.
But Office 365 not likely/ not as long as I've got a laptop.

My first thought is someone staring at a little bitty phone screen trying to edit something on 365 while drive down the road so their boss doesn't know they screwed up plus left work early.

Do you have a tablet perhaps?

Microsoft Office comes to Android, but not tablets or BlackBerry
Article here

The company made the software available Wednesday through Google's online Play store. It requires a $100-a-year subscription to Office and won't be sold separately.
The new offering follows the release of an iPhone version in June and brings an Office app to phones running the most widely used operating system on new smartphones.

Like the other mobile versions, the new Android software is designed for lightweight use. For example, you can use it to view and edit an attachment sent by email. But it's not meant to create a complex spreadsheet from scratch.
Microsoft is trying to make its Office 365 subscription more compelling, without removing an advantage that tablet computers running Microsoft's Windows system have - the ability to run popular Office programs such as Word, Excel and PowerPoint.
"The release of this app shows that we're committed to keep providing additional value for Office 365 subscribers," the company wrote in a blog post. "Office 365 subscribers will now be able to access, view, and edit Word, Excel and PowerPoint documents with Windows Phone, iPhone and Android phones."
Microsoft is pushing subscriptions as a way to get customers to keep paying for a product that was historically sold in a single purchase. The company touts such benefits as the ability to run the package on multiple computers and get updates for free on a regular basis. However, a subscription can be more expensive than buying the package outright for just one or two computers.
Microsoft said it designed Office Mobile for Android phones specifically for the phone's smaller screen, even though many people will prefer editing documents on a tablet's larger screen. The company has a version for iPads and Android tablets, called Office Web Apps, but that runs on a Web browser and requires a constant online connection. The new Android software is an app that gets installed on the phone and can work offline.
With a subscription, customers typically get to use Office on up to 10 devices. Five of them can be Windows or Mac computers or Windows tablets. The other five can be iPhones or Android phones. Windows phones come with Office installed and do not count toward the limit.
In failing to make a version for the iPad, the top-selling tablet computer, Forrester Research analyst JP Gownder has estimated that Microsoft is potentially ceding $1.4 billion a year in revenue, based on 10 per cent of the 140 million iPad owners paying for a $100 subscription. Gownder said failure to provide it on the iPad or Android tablets gives incentives for users to explore competing offerings such as QuickOffice from Google and iWork from Apple.
Technically, iPad users can download the iPhone version, but it doesn't take advantage of the larger screen, so images and text are fuzzy when blown up. Android tablet owners won't be able to download it at all through the Play store.
The new software requires Android 4.0 or later - the Ice Cream Sandwich or Jelly Bean flavours of Google's operating system. At first, it's available only in the US, though Microsoft plans to expand to 117 markets with versions in more than 30 languages.

I hope it's a joke as most sources aren't horribly reliable (yahoo news, this indian site, an UK based news site), but this detail seems to be very fresh news.

I was expecting something that would be comparable to kingsoft office, that is what I have (not used a lot, but did save my backside a few times from my Xperia phone) and the best office suite for Android afaik.

Heck, and they come up with something that requires a 100$ yearly subscription and works only on phones?

I have paid for Android apps (mostly to be rid of the ads that free apps push on you) but agree with jimbo that Kingsoft Office works great on my Android phone and tablet and allows me to view/edit spreadsheets, word docs and power point files. Layback - Have no fear, I don't try to do this while driving down the road!

The point being that this way they aren't getting the revenue that they could get by selling it at say 10 bucks (the highest price I think someone will pay for an app), while giving it for free to Office 365 users does not make Office 365 any more interesting as there are already a lot of good free alternatives for Android (and because it's mainly geared for PC users anyway).

So yeah, they managed to do the worst possible choice imho.