Hands-on with the new Office 365 business plans

Hands-on with the new Office 365 business plans

Summary: With the public launch of its new Office 365 business plans, Microsoft's move into a subscription-based Office is nearly complete. How much technical skill does it take to set up and run one of these plans? Here's a hands-on look.


With today’s public launch of the new business editions of Office 365, Microsoft’s transformation of Office 2013 into a combination of software and services is nearly complete.

Yes, you can still buy perpetual licenses for the Office programs, but it’s clear that the future of Office, for consumers and small businesses and enterprises, is measured out by the month (with appropriate discounts for annual subscriptions). In exchange, your business gets enterprise-class mail and file storage services to go with the Office 2013 desktop programs.

See also:

I’ve been testing the entire Office 365 family for the past few months, starting with the already released Office 365 Home Premium and working my way up more recently to the new business editions. This post contains a capsule review of the new editions.

Unlike Office 365 Home Premium, which uses a free Microsoft account and is aimed at families, the new business editions require organizational accounts. They come with Exchange Online, SharePoint Online, and Lync as part of a package that also includes the new Office 2013 desktop programs.


The difference between Office 365 Small Business Premium and Office 365 Enterprise is twofold:

  • The Small Business Premium package (P2) tops out at 25 users. There’s no minimum number of users, which means you can pick up a single user license, at a cost of $15 per month or $150 per year, attach your own domain name, and get straight to work on up to five devices.
  • The Office 365 Midsize Business plan scales up to 300 users. If your business is larger, you need the Enterprise (E3) plan, which can scale up for organizations of any size. These plans include a much richer feature set (Active Directory integration, for example) with a correspondingly more complex administration console. They also carry a higher price tag than the Small Business Premium plan: $15 and $20 per user per month, respectively.

All of the business packages include the right for each user with an assigned license to install Office 365 Pro Plus on up to five devices. Each user can activate and deactivate licenses as they wish, transferring licenses between different PCs and Macs without restriction. Enterprise administrators can control this process through policy; Small Business admins have no such option

You’ll need some technical knowledge to set up an Office 365 Small Business Premium plan, but many administration tasks are wizard-driven and a Getting Started page walks you through most of the essential tasks.


By contrast, the Enterprise dashboard is much more detailed, with opportunities for granular control of policies. The opening screen displays the current health of online services, with links to display recent problems with services or user accounts.


Here are some of the individual tasks you’ll tackle as an Office 365 administrator:

DNS setup

When you sign up for a business Office 365 plan, you’re initially assigned a subdomain, in the form example.onmicrosoft.com. To make the account more business friendly, you'll want to assign your own domain (or domains) to it. That way your users get email addresses like john@example.com.

For the Small Business Premium plan, you can completely delegate DNS administration to Microsoft, which requires only bare minimum of tinkering with DNS records. By contrast, the DNS setup for an Enterprise account assumes that you'll want to manage your own DNS records. That means setting up at least seven separate DNS records to handle mail and messaging.


If you've set up DNS records before, the process isn't particularly difficult, and an online troubleshooter can identify most common problems. It took me a matter of minutes to set up DNS for my test accounts. 

Creating user accounts and assigning licenses

Adding a new user in the Small Business admin console is a dead simple process. Enter a first and last name and the display name that will appear in the directory, and then assign an email address, using any of the domains you've attached to the account.


Walk through the remainder of the wizard's five steps to assign a license to the user and send an email with a temporary password.

The process for a creating a new user in an enterprise plan is nearly identical, with the single exception that the licensing assignment allows you to select or exclude individual services.

The user experience

Microsoft has transformed Office.com into a portal for Office 365 subscribers. When you sign in at Office.com with your organizational credentials, the display you see is dramatically different from the one that Office 365 Home Premium users see.

Here's my personalized home page, with a list of documents created and stored in SharePoint.


Individual users with assigned Small Business Premium licenses can install the latest version of Office from this page.


The other big difference from a Home Premium account is the navigation bar along the top of the page. Where Home Premium users see links to the free Hotmail and SkyDrive services, business users get links to Outlook Web Access, online calendars and address books, and SharePoint (confusingly also called SkyDrive).

I'll have a closer look at those services and at some of the subtle improvements in Office 2013 in a follow-up post.

Topics: Enterprise Software, Microsoft

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  • Security?

    Ok, who in their wrong mind is going to use this in the enterprise world? Microsoft isn't exactly known for data security and where are their policies on data retention etc?
    • You're kidding right?

      Enterprise customers have been using BPOS and the previous generation of Office 365 since 2007. There are millions and millions of enterprise seats under license, and with an Enterprise plan you can mix and match cloud and on-premises deployments.

      Man, you need to get out more.
      Ed Bott
      • I like your reply

        Well said.
        • Millions of flies can't be wrong...


          And that is the same answer given.

          Just because somebody else uses it doesn't mean it is secure from inappropriate use.

          MS was still the first to ever claim that anything entering their network domain belonged to them. Yes, they rescinded the statement... but that doesn't mean they stopped reading everything and anything crossing their network.
      • Well said...

        the one point I have is, what is with email retention?

        Under EU law, you have to keep all "business relevant" emails for 10 years in "unalterable form". That means not in the users inbox, they have to be kept in an internal archive, so that if the user deletes or alters the copy in their inbox, the original is still available.

        Exchange, as a product, supports this (and has done since 2007), but how does Office 365 deal with that, if people join and leave a company, or the company stops using Office 365? Those emails for employees that have left the company still have to be kept for 10 years, even if their Office 365 "account" no longer exists.

        Likewise, if the company stops using Office 365, they still need access to that read-only archive for the next 10 years. How does Microsoft deal with that? Do they keep the store hived away, in case it is needed, or can the company get a copy of that archive, when they leave?

        (Exporting all of the mail accounts to the new system wouldn't be acceptable, as the company cannot guarantee that all business relevant emails are still in the account or that they have not been altered.)
        • Office 365 ist targeting the US market, to Europe.

          For European companies, its not legal to use US-based cloud services anyways - Due to the patriot act data stored on US servers can be accessed by US authorities any time and without warrant. That contradicts the European privacy legislation.
          No need to worry about long time storage if the basics are not fulfilled already.
          • Agreed

            The Patriot Act is another big problem. But Microsoft are pushing the service in Europe as well, so, regardless of the Patriot Act, it would be interesting to know whether they are tackling this requirement or not.

            At the end of the day, the company has to judge whether it is worth the risk.
        • Data retention and archiving are covered in Enterprise plans

          You'll have to go read the service agreement for those plans to see the details, but this is a big focus of the service. Remember, the mail portion of Office 365 is Exchange Online. Data retention and compliance features are baked in to those.
          Ed Bott
          • Built-in, yes

            But what happens when the customer stops using the service? Does MS keep the data for the 10 years or do they give the customer the ability to dump the email archive?
      • I do believe

        A Google-savvy user might find articles titled, "Microsoft BPOS uptime sparking customer angst, pleas for help" and "Microsoft's BPOS cloud customers hit by multi-day email outage" appearing in some rather obscure publication....
    • the policies are public

      Go check out the Office 365 Trust Center http://office.microsoft.com/en-gb/business/office-365-what-is-business-trust-center-FX103030390.aspx - especially the EU Model Contract clauses.
    • Well Said Ed...

      Mr Smith, with all due respect, crawl out from under your rock and see the daylight. Office 365 is FISMA certified and has a functionality and feature set that can't be beat. We have been on the platform (BPOS) for 3 years. Rock solid reliability, great price, and very secure.
  • So the Small Business Premium gets local Office 2013 Pro Plus installs?

    So it is similar to Home Premium, but with commercial use rights?
    • Yes, with addition of Lync

      Lync is missing from Home Premium as well, which makes sense. You use Skype for the home, Lync for business. InfoPath is also not in Home Premium, but that's not as big a deal as Lync.
      Ed Bott
  • Bit confused on pricing of Office 365 Small Business Premium

    Ed you indicated Office365 Small Business Premium was "at a cost of $15 per month or $150 per year" yet when I look at a slide in Mary Jo Foley's article http://www.zdnet.com/microsoft-launches-updated-office-365-for-business-users-7000011896/ it seems to indicate that the cost per user is $12.50 a month.

    So if a small company of 5 people the cost for Small Business Premium per years would be $5 x $150=$750 (or using Mary Jo's 5 x $125) even if each of these people would only be using Office on their desktop computer? Was wondering in this example if a small business could legally use one Small Business Premium license for all of these 5 users.
    • From what I can tell, the license is per user

      And each user gets 5 machine licenses. Trying to get one user account to work across 5 machines would defeat the purpose of Office 365.
      Go with Open Licensing if you only need Office 2013 without the SharePoint, Lync, etc.
    • $12.50 per month is the same as $150 per year

      12 months in a year, times 12.50 = 150. Sort of like 2 months free if paid in advance.
    • Answers

      That $12.50 number is based on annual purchase ($150/12). But you can buy month to month if you want, for $15. I just checked and this is accurate: http://office.microsoft.com/en-us/business/office-online-microsoft-office-365-for-small-businesses-FX103037625.aspx?

      Small Business Premium is per user, so each user has to have their own account and (at least one) mailbox.
      Ed Bott
  • Is the hosting only on their platform?

    Do Enterprise Customers have the option of purchasing the hosting service and run it on-site instead of over the Internet? Not talking about installing the physical copy on the user's machine, but using the browser interface and connecting to a local server.
    • You can integrate on-premises and cloud

      That can be done in the Enterprise SKUs. Presumably anyone who wants to do that already has a substantial investment in VL and a dedicated account rep who can provide technical contacts.

      (Yes, I know that sounded like Mike Cox for a second.)
      Ed Bott