Executive Summary

Contributing Analysts: Rob Helm, Rob Sanfilippo

Office 365 is a set of service plans that combines the current versions of Microsoft online services (such as Exchange Online Standard) with optional subscription licenses to Office Professional Plus 2010.

Office 365 includes the next versions of the following Microsoft-hosted services:

• Exchange Online, powered by Exchange Server 2010
• SharePoint Online, powered by SharePoint Server 2010
• Lync Online (formerly Communications Online), powered by Lync Server 2010.

Office 365 introduces many new service plans that bundle various levels of the three services, substantially expanding the set of options over the previous version, referred to as the Business Productivity Online Suite (BPOS). Like BPOS, Office 365 enables organizations to move generic IT functions such as e-mail out of their data centers and offload deployment, management, and security patching responsibilities to Microsoft. Office 365 offers these advantages with fewer feature compromises than BPOS did when compared with on-premises servers, and with some additional advantages that competitors such as Google or Zoho will find hard to match, such as easier migration from on-premises and lower user-retraining costs. As with BPOS, the most important limitations of Office 365 concern potential availability and security, but there are other limitations such as available features and migration costs. Migrating to Office 365 or any hosted service requires entrusting an organization’s key communication channels and data to another party. As a result, customers should ensure that they understand how their data will and will not be secured, backed up, and recovered.