What Is Office 365? What's Included, What It's Used For and How It Became Microsoft 365
Office 365 is Microsoft's subscription service for email, documents, file storage and teamwork. This guide explains what Office 365 is, what you get in each plan, how businesses use it day to day, and why most plans now carry the Microsoft 365 name.
Quick answer: what is Office 365?
Office 365 is a cloud-based subscription from Microsoft that combines the Office apps (Word, Excel, PowerPoint and Outlook) with online services for business email, file storage, sharing and communication. In April 2020 Microsoft renamed most Office 365 plans to Microsoft 365, so when people say "Office 365" today they usually mean a Microsoft 365 subscription.
- What it is: a monthly or annual per-user subscription, not a one-off software purchase.
- What's included: Word, Excel, PowerPoint, Outlook, OneNote, Teams, Exchange Online email, OneDrive and SharePoint, depending on the plan.
- What it's used for: business email and calendars, creating and co-editing documents, storing and sharing files, meetings and chat, and securing company data and devices.
- What it costs: UK business plans start at £5.40 per user per month (Business Basic, annual, ex VAT), with Business Standard at £10.80 and Business Premium at £16.90.
1. What Is Office 365?
Microsoft Office 365 is a subscription service that gives each user the Office apps along with a set of cloud services hosted in Microsoft's data centres. Instead of buying a boxed copy of Office once and installing it on one computer, a business pays per user, per month, and gets the latest versions of the apps plus email, storage and collaboration tools that run online.
Microsoft launched Office 365 in 2011. It replaced the old model where a company ran its own Exchange email server and file server in a back office, with services Microsoft looks after in the cloud. Staff sign in with a work account and can reach their email, files and calendar from a laptop, phone or browser, wherever they are.
Why it's now called Microsoft 365
On 21 April 2020, Microsoft renamed its small business and consumer Office 365 plans to Microsoft 365. Office 365 Business Premium became Microsoft 365 Business Standard, for example, and Office 365 Business Essentials became Microsoft 365 Business Basic. The services inside stayed largely the same; the new name reflected that the subscription had grown beyond Office apps to include security, device management and tools such as Teams.
The Office 365 name has not disappeared completely. Large organisations can still buy Office 365 E1, E3 and E5, which cover the apps and cloud services without the extra Windows and device management features found in Microsoft 365 E3 and E5. In January 2025 Microsoft also renamed the Microsoft 365 app (previously the Office app) to the Microsoft 365 Copilot app, which adds to the confusion when people search for "what is Microsoft 365 Office".
Office 365 or Microsoft 365: which name should you use?
For a UK small or mid-sized business, they mean the same thing in practice. If your invoice says Microsoft 365 Business Basic, Standard or Premium, you have what most people still call Office 365.
2. Office 365 vs Microsoft 365 vs Office 2024
Three products are regularly confused with each other. The table below sets out the difference.
| Product | How You Pay | What You Get |
|---|---|---|
| Microsoft 365 (Business, E3, E5) | Per user, monthly or annual subscription | Office apps, cloud services, Teams, and on higher plans, device management and advanced security. |
| Office 365 (E1, E3, E5) | Per user, enterprise subscription | Office apps (E3 and E5) and cloud services such as Exchange, SharePoint and OneDrive, without Windows licensing or Intune device management. |
| Office 2024 / Office LTSC 2024 | One-off purchase | Desktop Word, Excel, PowerPoint and Outlook for one computer, with security updates but no new features and no cloud services included. |
One-off versions of Office have a fixed support life. Office 2016 and Office 2019 reached end of support on 14 October 2025, and Office 2021 follows on 13 October 2026. After those dates there are no further security updates, which is why most businesses still running older perpetual copies are moving to a subscription.
↑ Back to Contents3. What Is Included in Office 365?
What is in Office 365 depends on the plan, but every business plan is built from the same set of apps and services. The biggest difference is whether users get the installable desktop apps or the web and mobile versions only.
| App or Service | What It Does | Business Plans |
|---|---|---|
| Word, Excel, PowerPoint | Documents, spreadsheets and presentations, with real-time co-authoring | Web and mobile on Basic; desktop on Standard and Premium |
| Outlook & Exchange Online | Business email on your own domain, shared calendars and contacts, with a 50 GB mailbox per user | All business plans |
| Microsoft Teams | Chat, video meetings, calls and team workspaces | All business plans (versions without Teams are also sold) |
| OneDrive | 1 TB of personal cloud storage per user, synced across devices | All business plans |
| SharePoint | Shared document libraries, team sites and company intranets | All business plans |
| OneNote, Planner, Forms, Lists, Bookings | Notes, task boards, surveys, simple tracking lists and customer appointment booking | All business plans |
| Microsoft 365 Copilot Chat | AI chat with enterprise data protection, for drafting, summarising and research | All business plans, at no extra cost |
| Intune, Entra ID P1, Defender for Business | Device management, conditional access and endpoint protection | Business Premium only |
Access is included in some plans on Windows PCs only, and Microsoft is retiring Publisher in October 2026, so neither should be treated as a reason to choose one plan over another. For a closer look at how AI fits into the subscription, our guide to whether Microsoft Copilot is free covers what Copilot Chat includes and what the paid licence adds.
↑ Back to Contents4. What Is Office 365 Used For?
Asked what Office 365 is used for, most people answer "Word and email". In a typical UK business it ends up running far more of the working day than that. These are the jobs it handles most often.
Business email and calendars
Professional addresses on your own domain, shared mailboxes for sales@ or accounts@, and calendars that show colleagues' availability when booking meetings.
Creating and co-editing documents
Several people can work in the same proposal, budget or slide deck at once, with every change saved and version history kept automatically.
Storing and sharing files
Company files move off a server in the office and into shared libraries that staff can reach from anywhere, with permissions controlling who sees what.
Meetings, chat and calls
Video meetings with clients and colleagues, group chat by project or department, and with Teams Phone, a replacement for a traditional phone system.
Tracking tasks and requests
Simple task boards, onboarding checklists, asset registers and internal request forms, without buying separate project management software.
Securing people and devices
Multi-factor sign-in, rules about which devices can open company data, and the ability to wipe a lost laptop or phone remotely.
If you are unsure whether a file belongs in Teams, SharePoint or OneDrive, our comparison of Microsoft Teams vs SharePoint explains how the three fit together.
↑ Back to Contents5. Office 365 Plans and UK Pricing
Microsoft's business plans cover organisations with up to 300 users. Above that, businesses move to the enterprise plans (Microsoft 365 E3 and E5, or Office 365 E1, E3 and E5). Microsoft raised the price of Business Basic and Business Standard on 1 July 2026, while Business Premium stayed the same.
| Plan | UK Price | Key Difference |
|---|---|---|
| Microsoft 365 Business Basic | £5.40 per user/month | Email, Teams, OneDrive and SharePoint, with web and mobile Office apps only |
| Microsoft 365 Business Standard | £10.80 per user/month | Everything in Basic, plus installable desktop Office apps on up to five PCs or Macs per user |
| Microsoft 365 Business Premium | £16.90 per user/month | Everything in Standard, plus Intune, Entra ID P1, Defender for Business and Purview information protection |
Microsoft UK list prices for plans including Teams, on an annual subscription paid yearly, excluding VAT, checked October 2026. Monthly subscriptions cost around 20% more.
You can mix plans within one tenant. A common setup gives office staff Business Standard or Premium, while warehouse or field staff who only need email and Teams on their phones use Business Basic.
↑ Back to Contents6. Choosing the Right Office 365 Plan
The price gap between plans is smaller than it looks once you count what you would otherwise buy separately. Since the July 2026 change, Business Premium costs £6.10 per user per month more than Business Standard, and that difference replaces separate endpoint protection and device management tools for many businesses.
✔ Business Standard often suits
- Small office teams who need desktop Office apps and Teams but already have separate security tools in place.
- Businesses with no regulated data and no client or insurer asking for device controls.
- Users on company devices that are already managed another way.
✘ Consider Business Premium if
- You hold client or personal data that falls under UK GDPR and want to control where it can be opened.
- You're working towards Cyber Essentials, where device management and MFA make the controls easier to evidence.
- Staff use personal phones for email and need company data separated from personal apps.
7. Office 365 Security: What's Built In and What Isn't
Microsoft secures the data centres, the infrastructure and the availability of the service. Configuring your tenant is your responsibility. Under Microsoft's shared responsibility model, decisions about who can sign in, from which devices and with what level of verification, sit with you or your IT provider.
Every business plan includes the basics: spam and malware filtering for email through Exchange Online Protection, and the option to require multi-factor authentication. Business Premium goes further with conditional access policies, endpoint protection through Defender for Business and device management through Intune. These are the controls our managed cyber security team configures most often, and they map closely to the requirements of Cyber Essentials certification.
Office 365 is not a backup
Recycle bins, version history and retention policies help you recover from everyday mistakes, but they are not a separate backup. If a mailbox is deleted, a user account is compromised or ransomware encrypts synced files, recovery windows are limited. Most businesses add a third-party Microsoft 365 backup that keeps copies outside their own tenant.
8. Moving Your Business to Office 365
Whether you are coming from an on-site Exchange server, Google Workspace or a mix of personal email accounts and shared drives, a move to Office 365 follows the same broad sequence.
Audit what you have
List every mailbox, shared drive, user and device, along with any software that relies on your current email or file server. This decides which licences you need and how long the move will take.
Choose licences and set up the tenant
Pick the right mix of plans, verify your domain and apply a security baseline (MFA, admin roles and sharing settings) before any data moves in.
Migrate email and calendars
Copy mailboxes across in the background, then switch your domain's mail records so new email arrives in Exchange Online with minimal disruption.
Move files into SharePoint and OneDrive
Restructure shared drives into SharePoint libraries with sensible permissions, rather than copying a messy folder structure into the cloud as it is.
Train staff and support them
Show people where their files now live, how to share links instead of attachments and how to use Teams for meetings. The first two weeks after go-live are when most questions come in.
Our cloud migration services cover each of these stages, and our Microsoft 365 support team looks after licences, users and day-to-day issues once you are live.
↑ Back to Contents9. Getting More From Your Office 365 Subscription
Most businesses use a fraction of what they already pay for. Once email and files are settled, these are the areas where Office 365 tends to deliver the next round of value.
A proper intranet and document management in SharePoint
SharePoint can replace a shared drive with structured libraries, metadata, approval workflows and a company intranet for policies and news. Our SharePoint services team designs sites around how your teams actually find and file documents.
Reporting with Power BI
Data that lives in Excel files across the business can be brought together in Power BI dashboards. Power BI Pro is a separate licence, though it is included in Microsoft 365 E5. Our Power BI services help businesses build reports from finance, sales and operational data.
Connecting finance and operations with Business Central
Dynamics 365 Business Central is Microsoft's ERP system for small and mid-sized businesses. It works directly with Outlook, Excel and Teams, so quotes, invoices and stock information can be opened from the tools staff already use. Find out more from our Business Central partner team.
↑ Back to Contents10. Frequently Asked Questions
What is Office 365?
Office 365 is a subscription service from Microsoft that combines the Office apps, such as Word, Excel, PowerPoint and Outlook, with cloud services for business email, file storage, sharing and communication. Most Office 365 plans were renamed Microsoft 365 in April 2020.
Is Office 365 the same as Microsoft 365?
For small and mid-sized businesses, yes in practice. Microsoft renamed its business and consumer Office 365 plans to Microsoft 365 on 21 April 2020. The Office 365 name is still used for the enterprise E1, E3 and E5 plans, which do not include the Windows and device management features found in Microsoft 365 E3 and E5.
What is included in Office 365?
Business plans include Word, Excel, PowerPoint, Outlook and OneNote, Exchange Online email with a 50 GB mailbox, Microsoft Teams, 1 TB of OneDrive storage per user, SharePoint, Planner, Forms, Lists, Bookings and Microsoft 365 Copilot Chat. Business Standard and Premium add desktop Office apps, and Business Premium adds Intune, Entra ID P1 and Defender for Business.
What is Office 365 used for?
Businesses use Office 365 for email and calendars, creating and co-editing documents, storing and sharing files in OneDrive and SharePoint, video meetings and chat in Teams, tracking tasks and requests, and securing company data and devices.
How much does Office 365 cost in the UK?
Microsoft UK lists Microsoft 365 Business Basic at £5.40, Business Standard at £10.80 and Business Premium at £16.90 per user per month, on an annual subscription paid yearly and excluding VAT. Monthly subscriptions cost around 20% more.
Can I use Office 365 without the internet?
Yes, if your plan includes the desktop apps. Business Standard and Business Premium let you install Word, Excel, PowerPoint and Outlook and work offline, with changes syncing when you reconnect. Business Basic includes only the web and mobile apps, so it relies on a connection for most tasks.
What is the difference between Office 365 and Office 2024?
Office 365 is a subscription that includes the latest Office apps plus cloud services such as business email, OneDrive, SharePoint and Teams. Office 2024 is a one-off purchase of the desktop apps for one computer, with security updates but no new features and no cloud services.
Does Office 365 back up my data?
Not in the way a dedicated backup does. Office 365 includes recycle bins, version history and retention policies, but recovery windows are limited and data stays inside your own tenant. Most businesses add a third-party Microsoft 365 backup to keep separate copies.
How many users can a Microsoft 365 Business plan have?
Microsoft 365 Business Basic, Standard and Premium support up to 300 users per plan. Organisations above that number use enterprise plans such as Microsoft 365 E3 and E5 or Office 365 E1, E3 and E5.
Get Your Office 365 Set Up Properly
As a Microsoft Solutions Partner and managed IT services provider, we can review your current licences, recommend the right plan for each user and handle the move to Microsoft 365 from start to finish.
Speak With a Microsoft 365 Consultant 0161 834 9345
