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What Microsoft Won’t Tell You about Office 365 Subscription Plans

IT managers are by nature conservative. It comes with the job. So your first reaction to the thought of replacing traditional software installations with subscription services is likely to be, “What’s the catch?”

That’s especially true of Office 365, Microsoft’s subscription-based replacement for its traditional enterprise productivity services. Businesses worldwide run on Microsoft Exchange, SharePoint, and other server-based products, with employees using perpetual-license versions of Microsoft Office productivity programs on Windows PCs and Macs.

Switching to a subscription-based service means getting a more-or-less predictable monthly bill rather than writing huge checks every few years for companywide upgrades.

There are other, less tangible differences, too.

Per-user licensing eliminates the headaches of buying, assigning, managing, and tracking individual software licenses and client access licenses (CALs) for server products. You assign a license to an employee based on his organizational email address; when the employee leaves the organization, you remove his license from the Office 365 dashboard. That straightforward process eliminates the cost and uncertainty of annual licensing audits for traditional licensing.

In Office 365 plans that include the traditional Office programs—Word, Outlook, Excel, and so on—each user in your organization is entitled to install the software on up to five devices. Those installations are initiated by the user, with no product keys or installation media required. She just signs in using her organizational credentials and uses the Click-to-Run installer. New product features, even whole new versions, are installed automatically as part of the normal background update process. That sure takes a load of work off the shoulders of any system administrator.

That doesn’t mean everything in the transition to Microsoft’s suite of cloud applications and services is self-evident. If you’re considering a Office 365 migration, here are three key factors to consider.

Factor in all the costs

The simplest calculation for an Office 365 migration doesn’t require a spreadsheet. Just count the number of seats and multiply by the annual cost of your enterprise plan.

Chances are that number will seem high, perhaps as much as 30% higher than your corresponding budget for traditional server and desktop software licenses.

But the total cost becomes more reasonable when you factor in some of the savings:

  • Lower data center costs: You probably won’t be able to eliminate your server room completely, but you should be able to consolidate servers and cut your hardware budget.
  • Reduced IT workload: Because Microsoft is managing Exchange, SharePoint, and other servers, your IT pros don’t have to plan for downtime to install patches on the second Tuesday of each month.
  • Fewer help desk calls: Those self-service installations of Office apps on Windows, Mac, and mobile devices mean no lost product keys and no activation issues, both of which can cause serious support headaches and user angst.

Don’t be afraid to mix and match plans

Microsoft has a dizzying array of plans for Office 365. Plans in the Business group are intended for organizations with fewer than 300 users, while those in the Enterprise group allow you to provision an unlimited number of users.

The easy path is to choose the $20-per-month E3 plan for everybody, with Exchange email, OneDrive for Business, and the full suite of Office desktop programs and mobile apps. But you can squeeze out significant savings if you look past those all-in-one plans.

Do you want some workers to have email only, without the full Office desktop suite? Then look at the two Exchange Online plans, which cost $4 and $8 a month, respectively. You can also trim costs by choosing individual services (such as Skype for Business online conferencing) from the a la carte menu.

Some judicious choices here can shave that monthly budget by 10% or more without impacting productivity.

Take advantage of security options

Office 365 email is encrypted at rest and in transit, which protects from possible data theft. But an even more significant addition to the platform is multi-factor authentication, which significantly lowers the risk that user accounts will be hacked or phished. Authenticator apps are available on every mobile platform, which means your users can take advantage of the greater security afforded by multi-factor authentication regardless of which type of smartphone they use.

Recommended Resources: Druva 2017 VMware Cloud Migration Survey


1 Comment

  1. David Wilming 4 years ago

    good post Ed but I would argue that Microsoft’s email is only encrypted in transit withing the microsoft exchange ecosystem. That is why you have to buy message encryption extra from Microsoft or 3rd parties since there is no guarantee the destination mail server supports TLS

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