Microsoft Office, as you may be aware, has long been one of the more profitable jewels in the Redmond giant's glittering crown. Even as fierce competition and the shift toward smartphone dominance undercut Microsoft's long-standing role as the 800-pound gorilla of computing in the enterprise, Office has remained the pre-eminent locally-run productivity suite out there.
Microsoft has responded to the challenge posed by Google Apps with Office 365, a similar suite of productivity software that brings the company's long experience with Office and Outlook into the cloud. But how do these two competitors stack up?
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(A note up-front: Prices are compared only for versions of Office 365 that can support an unlimited number of registered users, since Google Apps has no such restrictions. There are two editions of Office 365 that offer substantial discounts for accounts with 25 or fewer users, and one that offers a smaller discount for those with 300 or fewer. Check prices directly from Microsoft and Google if you're buying.)
The common theme in this comparison starts here Google Apps is a simpler and more digestible experience than Office 365, but its feature set is also much more limited. Web versions of venerable Office Apps like Word and Excel are less robust than their desktop counterparts, but still exhibit greater polish than their Google equivalents, and have the added bonus of being able to work with Microsoft's proprietary file formats. (Google Docs does do this now, but compatibility is imperfect.) Moreover, some Office 365 packages include the latest desktop versions of the apps for Windows and OS X, in addition to Lync and Skype for video and IM communication. As well, plans with desktop apps include OneNote, Access and Publisher.
That said, those packages are all more expensive than even the premium version of Google Apps, so for workplaces that can live with a more limited feature set, the economics are clear. Google Docs might not be Microsoft Word, but it's a lot easier on the wallet.
Both suites are actually relatively close to each other in terms of email, with Exchange Online and Gmail providing similar functionality. The web clients are obviously different Gmail is probably a slightly better and more flexible offering overall, although Outlook's web option is also well-designed and could help make a transition from a traditional Microsoft setup a bit smoother.
In terms of email, Microsoft offers 50GB for each user, Google offers 30GB though the comparison is a bit more involved than that, given that Microsoft's prices are generally higher. It's instructive to compare Google's entry-level offering (Google Apps for Business) to Microsoft's closest equivalent in terms of features, Office 365 Enterprise E1. The latter service is more expensive, at $8 per month per user to Google's $5 per month per user, which means that Microsoft is offering 6.25GB per dollar against Google's 6GB per dollar. It's still more, but it's not nearly as big of an advantage. Plus, more expensive packages don't add any more per-user storage, so that ratio deteriorates quickly.
That said, all Office 365 packages except stand-alone Exchange Online offer a further 25GB of cloud storage for each user via Microsoft's OneDrive service. Google charges an extra fee for any additional storage beyond the 30GB for Gmail and Drive, with prices starting at $4 per month per user for an extra 20GB ruining the value proposition somewhat, and making Office 365 considerably more attractive to customers with a need for hefty storage space.
Essentially, it depends on what you're looking for. Google Apps' simplicity, ease of use and no-fuss, no-muss setup will no doubt find a large number of takers, among organizations large and small. While not as feature-rich as Office 365, Google Apps offers enough functionality to present a compelling use case particularly at its low price point.
In contrast, Office 365 offers an experience that seems generally a bit more polished and extensive, in terms of capabilities but those advantages come at a price. Organizations that want a slightly more robust feature set, and those that can't bear to leave the original Office apps behind will be well-served by Office 365.
But it's tough to argue with the competition's low price, all else being at least close to equal, so Google Apps is probably the overall winner, by a nose. Plenty of other companies, however, will get their money's worth from Office 365.
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