Office 365 vs. Google for Work: A cloud comparison for small businesses

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Microsoft and Google offer low-cost cloud tools for small- and medium-size businesses, but each of their offerings has unique strengths and weaknesses. Here's a high-level comparison of Office 365 and Google for Work, specifically for smaller businesses.

The price of enterprise collaboration and productivity tools for small- and medium-size businesses has dropped considerably. Cloud-based services from Microsoft, Google and others are available for what many folks pay for a single cup of coffee.

Google beats Microsoft in the price war, with an entry-level offering that starts at $4.17 per month, per user with an annual commitment. Microsoft's cheapest plan costs $5 per month, per user with an annual commitment. Both companies offer flexible month-to-month options that start at $5 a month for the Google Apps suite and $6 a month for Microsoft's online versions of Office. Price obviously isn't the only concern for smaller businesses but it can be particularly important to young startups. Flexible pricing plans allow businesses to add or cancel employees as needed and can add up to significant savings over time. 

With competitive and relatively affordable prices, the choice between Google and Microsoft comes down to comfort, familiarity and brand affinity. All of the options come with the basics, such as Web-based email, calendar, messaging, documents, spreadsheets and presentation slides, but there are some notable differences in the features Google and Microsoft make available to business customers.

Microsoft Office 365 vs. Google for Work  

Mobile is a key differentiator between Office 365 and Google for Work, because Microsoft charges almost twice as much as Google for access to its mobile apps. A small business can use Google's full arsenal of smartphone and tablet apps for as little as $4.17 per month per user, while Microsoft charges at least $8.25 a month for the privilege.

[Related Analysis: Google for Work vs. Microsoft Office 365: A comparison of cloud tools

Many business owners make platform decisions based on tools their organizations already use or are most comfortable with. Established preference aside, the choice between Google and Microsoft usually comes down to features, price and access.

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Microsoft Office 365 for Small Businesses: Features, price and access

Microsoft has three Office 365 plans for smaller businesses, with prices that range from $5 to $15 per month per user. Companies willing to commit to yearly plans get discounts of around 17 percent, and organizations must have 300 or fewer users to qualify for SMB pricing.

[Related Analysis: Office 365 and Google for Work adoption rates to grow rapidly]

Microsoft's entry-level Office 365 Business Essentials plan is its only small business offering that does not include access to Office applications for PCs, Macs, smartphones or tablets. That means Business Essentials customers have to rely entirely on Web-based versions of Office, which may not be worth the $3.25 per user they save by forgoing the next tier plan.

Office 365 Business and Business Premium plans, which cost between $8.25 and $12.50 a month with annual commitment, are likely a better fit for the average small business. Customers on either plan get access to familiar Office applications including Word, Excel, PowerPoint, Outlook, Publishers and OneNote for desktops, smartphones and tablets. And all three of Microsoft's Office 365 plans for small businesses come with 1TB of cloud storage per user. 

Google for Work for Small Businesses: Features, price and access

Google offers a simpler, more streamlined pair of plans for small business (or any size business) that costs $50 and $120 per year per user, with an annual commitment. The entry-level plan comes with the monthly discounted rate of $4.17 per user if organizations agree to that annual commitment, but the premium plan costs the same $10 per month, per user regardless of commitments.

[Related Feature: IT pros say Google slowly infiltrating enterprise, education]

Both Google Apps for Work plans come with online and mobile access to Google's popular services, including Gmail and Hangouts, as well as its other alternatives to Office, such as Docs, Sheets, Slides and Drive. That universal access to Google's mobile apps and Web-based tools is a key differentiator, but Google doesn't provide the same level of software for PCs and Macs as Microsoft. Google Apps customers can use Docs, Sheets and other Google applications offline but as any Office power user can attest, Google's offerings pale in comparison to the feature sets of Microsoft Word, Excel and other tools. 

With just 30GB of storage per user, Google's entry-level plan doesn't compete with Microsoft either. Google gets back in line at its premium level, however, with 1TB of storage per user or unlimited storage for accounts with at least five users. The $10 monthly plan also comes with advanced controls, policies and Google Vault, which helps administrators retain, archive, search and export an organization's email and chat messages. 

Microsoft Office 365 vs. Google for Work: Quick conclusion 

The price of Google's entry-level plan costs roughly 17 percent less per user than Microsoft's entry offering. When it comes to storage on entry-level plans, Microsoft nearly doubles Google. Bottom line: Price, storage, access and flexibility are important considerations for small businesss seeking cloud tools. However, in many cases the differences in features between Google for Work and Microsoft Office 365 are not as important as platform familiarity.

[Related Analysis: Why CIOs can't sell enterprise collaboration tools]

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