Office 365, announced today, gives professionals and small businesses a subscription service that lets them work from anywhere using familiar-feeling Web-enabled applications. Combined with hosted versions of Exchange, SharePoint, and Lync, Office 365 is designed to enable users to share, collaborate, and communicate in the cloud. In our testing during the beta, we found that the tools worked well across the board (with some hiccups), and expect that many people who use Office on desktop Macs and PCs will appreciate the familiar look and feel, which should help them get up and running quickly.

Obviously, Office 365 is going to draw comparisons to Google Docs along with Google Apps, the enterprise version of Google's online office suite. Google Docs remains free, making it an easy choice for many users, whereas Office 365 will cost at least $6 per user per month (see pricing at the bottom of this review). Microsoft is probably betting that with so many businesses already accustomed to the desktop versions of Microsoft Office, it will be an easy transition to Office 365. With today's launch, we will soon find out if people are willing to make the switch or choose Google's offerings instead.

Many businesses will also understandably wonder whether Office 365 will be a reliable alternative to desktop office suites and whether their information will be safe. Microsoft says that the company will guarantee 99.9 percent uptime for Office 365 servers to make sure you always have access to your work. Microsoft also includes its Forefront Online Protection for Exchange, which scans continually for viruses and spam in an effort to keep your business and its important information secure.

E-mail and calenders

Powered by Microsoft Exchange Online, Office 365 gives businesses access to e-mail, calenders, and contacts from virtually anywhere, on almost any device. The Microsoft Outlook Web app has a similar look and feel to Outlook for desktops, and can be connected with Office 2010 or Office 2007 so you have the same e-mail inbox everywhere. Unfortunately, those who use older versions of Microsoft Office for the desktop will be out of luck.

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Color-coded calenders let you plan appointments and schedule meetings with your co-workers. (Credit: Screenshot by Jason Parker/CNET)

Along with e-mail you'll be able to use calenders with all the features you need to schedule meetings and appointments. You'll be able to go to the calender app, view your coworker's availability, then set up a meeting time; your calender will now show the meeting time on whichever device you log in with.

Office Web apps

When it's time to create documents, Microsoft Office Web apps act as companions to the desktop versions of Word, Excel, PowerPoint, and OneNote, powered by Microsoft SharePoint. Though you won't have the laundry list of options found in the desktop versions, the Web apps offer enough features to create and edit documents while keeping the same formatting on your desktop and on the Web.

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Change text styles, add tables and images, and format your Word documents away from your desktop. (Credit: Screenshot by Jason Parker/CNET)

Like all of the Office 365 apps, Microsoft Word Online uses the Ribbon, the all-in-one tool across the top of every document found in the desktop version of the Office suite. The Ribbon in Word Online offers only Home, Insert, and View tabs that let you format, edit, and style text; insert tables, pictures, clip art, and links; and switch between editing and reading views. More-advanced settings, like tracking editing changes, for example, are not included in the online version of Word. But you always have a button in the Office 365 interface to open a document in your desktop version of Word.

Excel Online also offers basic features only, but you will be able to create tables, format fields including text and number formats, add links, and refresh data in Pivot Tables (think quick visual graphs based on the data) that are connected to those sections of the spreadsheet. Again, you will not get any of the more-advanced features found in Excel on the desktop, so the Office 365 version is more for edits and tweaks on the go.

Office 365
Create, edit, and change the order of slides, add graphics, and make quick tweaks to PowerPoint presentations. (Credit: Screenshot by Jason Parker/CNET)

Similarly, in PowerPoint Online you'll be able to create and edit basic slides, but you'll want to do most of the heavy lifting for major presentations using your desktop version of Office. While it will be great for last-minute additions while on the road, PowerPoint Online lacks more-advanced tools like animations and transitions.

OneNote provides the simultaneous collaboration piece of the online Office suite, letting you work with co-authors to gather and enter information. You can create separate section headings for different types of information and you can categorize your work using tags to point out specific areas of your project to other users. In our testing, we encountered some errors we could reliably re-create that would force us to exit or reboot OneNote. We'll give Microsoft some leeway here, because we know our version was still officially in beta at the time of this writing. Let's hope Microsoft will iron out the bugs in time for launch.

Communication and collaboration

Office 365 enables you to keep your organization's work in one place by creating a Team Site that's only available to users you choose. Here you'll be able to keep shared documents for collaboration, post messages for co-workers, or create new team subsites for specific projects. The Team site is highly customizable with plenty of tools with which to personalize the look and layout. You can also Check Out (as at the end of a workday, for example) so everyone knows who is or isn't online.

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Customize your Team site to show all your current projects and share documents with your team. (Credit: Screenshot by Jason Parker/CNET)

Even with access to Office 365 from anywhere, sometimes you need to contact someone directly--even if it's over the Web. Powered by Microsoft Lync Online, you can have a quick chat over a secure IM client, hold online meetings with audio and video, or share your desktop to show an employee exactly what you mean. Even people outside of your company can be given access so you can meet up with clients online.

Public Web site

When you're ready to share your work with the world, you can use Office 365 to create and maintain a public-facing Web site. The service gives you several layouts, and you can pick from hundreds of themes to match your type of business. You can make further changes to style and text for even more site variations, and you can include custom CSS code if you want to create a style sheet of your own.

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Create a public-facing Web site with hundreds of different themes and colors to choose from. (Credit: Screenshot by Jason Parker/CNET)


Office 365 for small businesses under 25 employees costs $6 per user, per month. Larger businesses can choose from four enterprise plans, from $10 per user to $27 per user per month for more options and advanced tools.


Overall, we think Office 365 is off to a good start, offering basic office suite tools most workers can pick up and use right away because of the familiar feel of Office products. Though the tools are not as advanced as those found in the desktop versions, we think businesses will appreciate the collaboration tools and the way the Team site ties all of your projects together. We are also impressed with the editing tools for the public-facing Web site that give you tons of options for creating a good-looking landing page for your business. Finally, we did encounter some bugs in our testing, but we're willing to reserve judgement and update this review when the service launches officially.

Jason Parker has been at CNET for more than 13 years. He is the Senior Editor in charge iOS software and has become an expert reviewer of the software that runs on each new Apple device. He now spends most of his time covering Apple iOS releases and third-party apps.