What is Office 365?

With more companies moving to the cloud every day, Office 365 is Microsoft's play to keep their business.

Considering its dominance of the desktop sector, it should come as no surprise that Microsoft is interested in gaining a strong foothold in the cloud computing market too. Having built its fortune selling software licenses, Microsoft is increasingly finding itself under pressure from companies such as Google, which look at software as a service to be provided, not as a commodity to be sold.

With Office 365, Microsoft is aiming to ensure that if its customers are interested in moving to the cloud, that they aren't moving away from Microsoft. Just a quick look at the feature set of Office 365 shows that Microsoft isn't playing around: key features include enterprise-grade Exchange email and calendar, a range of communication and collaboration tools, and a suite of web apps enabling Office 365 users to create and edit Office documents without needing any software, other than a web browser.

As with almost all cloud services, Office 365 is provided as a subscription, rather than at an upfront cost. There are multiple business benefits with this model, not least of which is the potential cost saving. An Office 365 subscription starts at £4.00 (from £15.75 if you want the full Office Professional Plus suite) per user, per month, which represents a significantly lower outlay than buying licenses for all the functionality it provides. Importantly, the monthly cost of Office 365 includes all updates, including security patches, ensuring that all users are on the most up-to-date version of the various components at all times.

It isn't just the upfront cost of software that Office 365 alleviates, however. By having this software hosted in the cloud, businesses can eliminate the need to house expensive servers, and the staff required to maintain them. This reduced barrier to entry also enables businesses too small to justify the outlay for on-premises solutions to enjoy enterprise-level features, without the associate cost or administration overhead.

Furthermore, Microsoft provides support for Office 365 online, so businesses don't need to worry about having support staff on-site in order to help workers that encounter problems with their software. As well as a comprehensive set of online documentation, Microsoft also allows customers to submit queries either via a web interface, or over the phone.

Another important feature of Office 365 is its 99.9 per cent SLA, ensuring that the vast majority of users are unlikely to ever notice any downtime. Whereas businesses with on premises solutions would have to schedule downtime to apply updates, or be unable to work if there was an unexpected outage - Microsoft takes care of all these concerns in the background.

Additionally, Microsoft takes responsibility for the security and integrity of data it stores for users; the scale at which Microsoft operates enables it to take far greater pains in this area than many businesses could, let alone would, ensuring that even a catastrophic hardware failure won't affect the integrity of your data.

The email component of Office 365 - Exchange Online - is likely to be one of the main draws for smaller businesses, which are unlikely to have been able to afford Exchange before. The only potentially complicated part of the set-up process rears its head if you wish to use a custom domain name (such as mybusiness.com) for emails, instead of one Microsoft provides, but otherwise configuration is hassle free - migration options for both Exchange and IMAP accounts are provided. Luckily, only one person per organisation will have to worry about this configuration process, for everyone else the transition to the cloud should be seamless.

The web version of Outlook will be appear very familiar to users of the desktop version, albeit with a cut-back feature set. The core features of Exchange are there, however, including the ability to access the same email, calendar and contact information from anywhere, alongside a comprehensive range of scheduling options for arranging meetings. Shared calendars make it easy for co-workers to share their availability with each other, reducing the most common frustration when arranging meetings - finding a time at which everyone is available.

Because of the Exchange foundations of the Office 365 email offering, using a desktop client is well supported. Obviously Outlook is Microsoft's preferred option, but other clients work, including OS X's built-in Mail client - just don't expect every feature to work if you aren't using a Microsoft client or operating system.

Mobile users are also catered for, with push email at the forefront of Exchange Online's feature set, and calendar and contact syncing coming in a close second. Thanks to the popularity and ubiquity of Exchange, every popular, modern mobile OS comes with support baked in, including iOS, Windows Phone 7, Android and BlackBerry.

Also part of the standard Office 365 range are web app versions of the core desktop Office applications. Despite running in a web browser, these still offer the core features that most Office users will require most of the time, and allow users to edit documents and files on computers that don't even have Office installed. Like some rival products, the Office web apps also offer real-time collaboration, enabling multiple users to work on the same document at the same time, regardless of location.

As well as supporting email on a custom domain, Office 365 also lets subscribers create a website for their business, via a web-based editor, although it's arguable that businesses interested in cloud services will probably have a website already. Nonetheless, the ability to quickly create public-facing web pages can give staff the ability to create sites if and when needed, without the need for any web development expertise.

Depending on the subscription taken, some Office 365 components are either available for an additional charge, or included in the cost. These comprise SharePoint Online, used for document management and inter-personnel collaboration, Lync Online, a real-time communication tool, and Office Professional Plus 2010, Microsoft's desktop Office suite provided by subscription, instead of a license basis.

Office Professional Plus 2010 is the most self-explanatory extra, and comes with a few perks over simply buying a desktop license - the foremost of which is the ability to install the software on up to five machines. For businesses that supply staff with multiple devices, this could translate to a notable cost saving - a single subscription can cover a couple of desktops, and a laptop with room to spare. Office Professional Plus comes with the latest versions of Word, Excel, PowerPoint and Outlook. The first three of these integrate tightly with SharePoint Online, while the latter is an obvious fit with Office 365's online email offering.

SharePoint Online is a web-based alternative to Microsoft's SharePoint server solution, which provides a comprehensive set of collaboration tools. Basic access, with a limited feature set is bundled with all Office 365 subscriptions, while the full package is unlocked either with higher-tier enterprise subscriptions, or for an additional monthly cost.

SharePoint Online gives users a range of tools both to encourage collaboration between co-workers, and to reduce, or eliminate, many of the frustrations that working in large groups can introduce. These include document versioning and co-authoring, secure storage of files in the cloud, and the ability to create both external and internal-facing websites.

As with SharePoint Online, basic access to Lync Online is provided with all Office 365 subscriptions, although additional features cost extra. Lync Online works similarly to Microsoft's Live Messenger service, enabling instant messaging, audio chats and video conferencing, but is geared towards business users, rather than consumers. Notable features include the tight integration with SharePoint Online, and Outlook (both on and offline), as well as the option to join Lync conference calls over a phone line.

There are still caveats to go along with all of the benefits of Office 365. The most important consideration is that in order to get the full Office 365 experience, you need to be connected to the Internet at all times. In a business running its own servers, losing the external Internet connection won't stop staff from sending emails internally, or saving documents to SharePoint. With Office 365, however, an Internet connection is all but required.

There's also the fact that for businesses with enough users, signed up to Office 365 for a long enough period, there comes a point where it could well prove cheaper to run a self-hosted solution. Obviously this brings with it the aforementioned issues of administration and maintenance, but it's still worth considering. That said, the advantage of Office 365 is that you can decide the level of package each user has. So while many workers will require an E3 plan, complete with Office Professional Plus, a good percentage of a workforce could manage on one of the cheaper options.

While the cloud may not be the silver bullet businesses want to solve any and all problems they might have, that doesn't mean it isn't a great solution to at least some of their problems. Microsoft has invested a lot of time and effort to get Office 365 to market, and you can bet that it's just going to get better from here on. As long as your business understands the potential limitations, there's absolutely no reason not to look to Office 365 as a leading example of the advantages that cloud services can deliver.