Microsoft officially rolled out its new Office 365 business suite earlier today. How does its pricing compare with its most visible rival, Google Apps?
In Australia, Microsoft is selling Office 365 in partnership with Telstra. The most basic plan for small business costs $7.90 a month per user, and includes Office Web Apps, Exchange Online, Lync Online and SharePoint Online, along with 25GB of storage.
The cheapest enterprise plan is $15.70 per user per month. That doesn’t actually include the Office Web Apps version, but does add Active Directory integration. A plan including Office Web Apps for enterprise runs at $25.70 per user per month, and one which adds full rental versions of the desktop office apps is $40.10 per month. The full list of plans is on the Microsoft site (Incidentally, those prices are higher than the US equivalents, though the US prices wouldn’t include GST while the local ones do — a factor we’ll return to later.)
Google Apps doesn’t have such a wide range of options. It charges $US5 per user per month, or $US50 per user per year. Unlike Microsoft, it doesn’t have specific offerings aimed at replicating Active Directory or some of the other enterprise services, so the most relevant comparison is arguably with the entry-level Office 365 option.
Both Microsoft and Google offer a 30-day free trial, which can be useful for assessment purposes, though in reality you’re not going to migrate your entire user base onto a trial version.
On those prices, Google does come out as slightly cheaper, though not by as much as you might first think when comparing the $US5 and $7.90 price tag. The latter includes GST, which can be offset against the GST your business has to pay to others — an option that doesn’t apply to the Google version. That brings the effective local price down to $7.18. In practice, you’ll almost certainly end up paying currency conversion charges for the Google option.
Telstra argues that an additional advantage of its partnership with Microsoft is that the Office 365 charges can be included on a single bill with other services such as telephony and internet access, meaning there are fewer invoices to process. It also assures us that unlike many of its consumer services, access to a single bill won’t depend on which billing system happened to be in place when you signed up with Telstra.
Microsoft pitches the familiarity of the Office environment as a reason to choose its option over Google. At its Australian launch, customer Andy Springer from Rookie Recruits noted that while his company had initially shifted to Google Apps as a cloud solution, users found the environment was unfamiliar and that features they used regularly didn’t exist in the Google equivalent. Rookie Recruits subsequently switched to the T-Suite offering from Telstra, and will be adding the new Office 365 features.
That’s not going to be the case for everyone by any means, especially if you’re a heavy user of Gmail. However, it does demonstrate that even when the price is, as Microsoft constantly put it, “less than a sandwich” for a month of access, factors other than basic price need to be considered before switching.
Evolve is a weekly column at Lifehacker looking at trends and technologies IT workers need to know about to stay employed and improve their careers.