If you have purchased a new Windows computer over the past year or so, you have likely been puzzled when trying to decide which version of Microsoft Office is right for you.
A quick search online for Microsoft Office shows at least three choices: Office 2016, Office 365 and Office Online (sometimes called OneDrive).
What’s the difference, and which version should you get?
First, let’s untangle the differences between these three choices by taking a look at Office Online, the free, basic version of Microsoft’s Office suite.
Office Online is a great place to start since it offers so many of the features that make the current version of Microsoft Office so powerful, including mobile apps, online storage and online editing from any device.
What is Office Online?
Office Online is the completely free, and completely web-based version of Microsoft Office (and, just to confuse things, Microsoft sometimes calls this free service OneDrive—also the name of its cloud storage service).
Just by signing in with your free Microsoft account you can access basic, stripped-down versions of Word, Excel, PowerPoint and several other productivity apps from any Internet browser on any computer.
A main selling point of this free service is that Office Online also saves your documents automatically, as you work on them. So, you won’t lose everything you’ve typed if you lose your internet connection.
Office Online also includes several free web-based services including:
Office Online is also integrated with Outlook.com. Not to be confused with the more powerful Microsoft Outlook email and calendar software program, Outlook.com is Microsoft’s simple, free web-based email app. It’s the successor to the popular Hotmail and Windows Live Mail webmail services.
As a free service, Outlook.com is simple to use compared to the more complicated Gmail, Google Inbox or the full version of Microsoft Outlook. Outlook.com also features a smartphone app which allows you to send email from any mobile device.
Office Online and Outlook.com are both integrated with OneDrive, Microsoft’s cloud storage service. The free version of OneDrive comes with a somewhat paltry 5GB of online storage, which should be enough to store any Office Online documents you create… but not much else compared to other online services.
You can also easily insert Word or other Office Online documents from OneDrive as attachments to emails sent from Outlook.com—you don’t have to search around for and upload a document from your computer as an attachment.
And, once again, there is a useful, free smartphone app for OneDrive that allows you to easily find and quickly share Office documents. Even as a free software suite, Office Online is a handy tool for quickly getting tasks done.
Office Online: Too Basic?
Despite all its features, if you’re looking for a suite of true productivity applications, the free version of Office Online is probably just not powerful enough. Besides the rather miniscule 5GB of complementary online storage offered by OneDrive, the free versions of Word, Excel and PowerPoint included with Office Online, are, in a word, basic.
These no-cost versions offer none of the powerful features of their paid counterparts. Still, as a free service Office Online does provide a way to create and share basic documents, slide decks and spreadsheets, or edit existing ones… but that’s about it.
If you want to design nice-looking Word documents or use any of Excel’s more sophisticated features, such as macros, Office Online will leave you disappointed.
Instead, you’re going to have to pay for either Office 2016 or Office 365.
So, Which is Better: Office 2016 or Office 365?
This leads to the next question: is it better to pay for Office 2016, or subscribe to Office 365?
While Office Online is free, you will have to pay to purchase both Office 2016 and Office 365. Both Office 2016 and Office 365 include the powerful, fully-featured versions of Word, Excel, PowerPoint and other Office applications.
The main difference between the two is that Office 2016 is a one-time purchase, while Office 365 is a subscription-based service—you must pay every month, or every year, to renew your subscription (this chart explains the differences between the basic versions of Office 2016 and Office 365).
However both Office 2016 and Office 365 must be downloaded and installed on your computer to get them to work—despite its status as a subscription service, Office 365 still resides on your Windows PC or your Mac as a software program.
The Basics of Office 365
Office 365 is the subscription-based version of the full Microsoft Office suite. You can pay a monthly subscription of about US$10, but the annual subscription, at about US$100, is cheaper. While renewing the Office 365 subscription will cost you more from year to year, it also comes with some compelling features that may make it a better choice than Office 2016.
For example, Office 365 subscribers receive 1TB of OneDrive online storage (Office 2016 purchasers generally do not) that can be accessed on any device. Office 365 also comes with monthly recurring Skype minutes.
Most importantly, Office 365 Home can be installed on five different PC’s or Macs as part of the subscription. This feature is ideal if your family has several computers.
There is also a cheaper Office 365 Personal subscription as well that can be installed on just one computer.
Since the Office 365 Home subscription can be shared with other members of your family, or even your friends, each person gets 1TB of storage of their own for as long as you continue to subscribe to Office 365.
That’s not a bad deal for a hundred bucks a year!
What You Get By Purchasing Microsoft Office 2016
The main selling point of Office 2016 seems to be that you only pay once for the software and after that Office is yours to keep.
The basic version, Office Home & Student 2016, costs about US$150 and can be installed on just one PC. This basic version includes Word, Excel, PowerPoint and OneNote, but none of the other Office programs, which must be purchased separately, or as part of a more expensive package.
For example, the more expensive Microsoft Office Home & Business 2016 includes the powerful Microsoft Outlook email and calendar program.
The benefit of purchasing and downloading Office Home & Student 2016 is that you only have to pay for the software once, and after that you own it. With Office 365 you are forced to renew your subscription once a year for around US$100, or risk losing access.
The Downsides of Purchasing Office 2016
So, you’ll have Office as long as you own your computer, and you’ll never have to worry about Microsoft suddenly upping the price of a subscription.
On the downside, Office 365 is regularly updated with new features, while Office 2016 only receives security updates. The subscription service also comes with 1TB of OneDrive storage, while Office 2016 usually does not—OneDrive online storage will cost extra for Office 2016 purchasers.
Besides that, the basic version of Office 2016 can only be installed on just one computer. Office 365 Home, on the other hand, can be installed on at least 5 PC’s.
Still, many computer owners are still getting used to the idea of subscribing to a software program or online service. It’s hard to get used to simply “renting” a software program rather than purchasing it outright.
But the benefits of subscribing to Office 365, especially if you own a number of computers, cannot be underestimated.
Which do you prefer? Paying for a subscription, or paying to actually own your own software? Let us know by emailing email@example.com.
A Simple Cheat Sheet for Understanding the Difference Between Office Live, Office 365 and Office 2016
- Office Live is the free online version of Microsoft Office; Office 365 is an annual subscription service, while Office 2016 is a one-time purchase.
- Both Office 365 and Office 2016 are installed on your computer.
- If you stop subscribing to Office 365 you will no longer be able to use Office on your computer; Office 2016 is forever.
- Office Live offers use of free, simple versions of Word, Excel and PowerPoint.
- Office 365 includes 1TB of online storage, while the basic version of Office 2016 does not.
- Office 365 Home can be installed on 5 computers; Office 2016 can be installed on one computer.