Microsoft announced the significant new product during its Inspire conference today. The company said that Microsoft 365, available in two different versions, represents a “fundamental shift” in how it builds software for businesses.
Microsoft is bundling its two flagship products, Windows and Office, into one subscription plan. This will give businesses everything they need to run their company, without looking to third-party providers. It’s an offer Microsoft hopes will prove to be irresistible, enabling it to stave off the growing competition from Google’s rival platform.
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Office 365 is now a well-established product. With over 100 million commercial users, it’s proved to be highly successful in the enterprise market. Microsoft’s gamble on moving Office licensing from a one-time fee to a cloud-based subscription has paid off. Companies are locked into its ecosystem, including services like Outlook, Power BI, Microsoft Teams and Planner.
Microsoft 365 takes Office 365 and throws in Windows 10 Enterprise too. Previously, businesses still had to pay for Windows licenses separately. The costs for a large corporation could be very high, leading some organisations to look elsewhere. Google has proved to be a competent rival, offering G Suite as a fully-fledged Office 365 alternative and low-cost Chromebooks as a way to avoid costly Windows licenses.
Microsoft 365 is a smart move to disrupt Google’s model. Businesses can now run Windows, Office and Microsoft’s Enterprise Mobility + Security package in exchange for one ongoing payment. The company said it’s a response to feedback from customers that they’re looking for a “modern” approach to software that reflects how devices are used.
“The workplace is transforming – from changing employee expectations, to more diverse and globally distributed teams, to an increasingly complex threat landscape,” said Microsoft. “From these trends, we are seeing a new culture of work emerging. Our customers are telling us they are looking to empower their people with innovative technology to embrace this modern culture of work.”
Microsoft 365 will be offered in two different versions, Enterprise and Business. The latter is a slightly scaled-down option aimed at smaller companies with under 300 employees. Both plans will be available from August 2017. The Business edition is priced at $20 per user, per month. Pricing details for the higher-tier Enterprise edition haven’t yet been announced.
