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Office 2016 vs Office 365: What’s the difference and What’s best for your Business?


Looking for business productivity application but confused between Office 365 & Office 2016 ? Then this blog post will help you find the correct choice for your business. No doubt, understanding the difference between Office 2016 and Office 365 can be confusing. But, don’t worry we will make it simple for you to understand.

Office 365 is a cloud subscription based service to improve business productivity that ensures you always have the most up-to-date tools for your organization from Microsoft. There are different Office 365 plans for small and mid sized businesses, large enterprises, schools, and nonprofits.

  • Office 365 Business
  • Office 365 Business Essentials
  • Office 365 Business premium
  • Office 365 ProPlus
  • Office 365 Enterprise E1
  • Office 365 Enterprise E3
  • Office 365 Enterprise E5

Most of the Office 365 plans for business, schools, enterprise and nonprofits  include the fully installed applications, but Microsoft also offers basic plans with the online versions of Office, file storage, and email. You choose whatever works best for your business: Small & Mid business, Enterprise, School, or Nonprofit.

Office 2016 is sold as one-time purchase, which means you pay one time up-front cost to get all Office applications for one computer. One-time purchases are available for both PCs and Macs (such as Office Home & Student 2016 for Mac). But the main disadvantage is that one-time purchases don’t have an upgrade option, which means if you plan to upgrade to the next major release in future , you’ll have to buy it again at full price.

Office 2016 as part of Office 365

If you purchase Office 2016 as part of an Office 365 plan, you have a lot more options for plans and a lot more features.

All Office 365 plans include:

  • Online versions of Office Applications like Word, PowerPoint, Excel etc.
  • 1 TB per user file storage & sharing on OneDrive
  • Sway Presentation creator
  • 99% uptime guaranteed
  • World-class data security
  • Active Directory integration to make user permissions

As you go higher in Office 365 plans, features you can get in addition to the above which includes:

  • Full desktop versions of Office Applications like Word, PowerPoint, Excel plus OneNote and Publisher on up to 5 computers per user
  • Office on tablet or mobile
  • Outlook with 50 GB of inbox space per user
  • SharePoint
  • Skype for Business
  • Yammer
  • Compliance Protection (Encrypted Email, Data Loss Prevention, etc)

Office 2016 or Office 365 ? Which is right for me? 

Below are few things to consider when deciding which version of Microsoft Office 2016 or Office 365 is right for your business:

Desired programs and features

Look for the programs and features which are important for your objectives. If you just need the basic Office programs like Word, PowerPoint and Excel apps, either a stand-alone version or a lower level Microsoft Office 365 plan is good enough for you. If you’re looking for programs like SharePoint, you’ll need to subscribe Office 365.

  • Office 365: Since Office 365 is a subscription based service, and you’ll get access to new features as they become available to public.


If you need to access your information from multiple devices, Office 365 is the way to go. While files in Office 2016 can be saved to the cloud, Office 365 gives you a lot more options for access plus the ability to install Office on multiple machines. It also gives you the ability to access online versions of Office programs from ANY device with an internet connection.

Movement between plans

Is it possible to upgrade your Office 2016 & Office 365 plan?

  • Office 2016: As Office 2016 is a standalone software, if you need to add extra features or upgrade, you can purchase and install new licenses for all users.
  • Office 365: Office 365 users can switch to higher plans in the admin center at any time.


What can you afford to pay per user? Would you rather pay a large sum up front or a small monthly fee?

  • Microsoft Office 2016: The stand-alone version is a one-time cost per user, so it will be a large expense up front, but you won’t have to pay a monthly fee after.
  • Microsoft Office 365: Office 365 is a subscription based plan, which means you won’t have to pay anything up front, but have to pay a set monthly fee per user per month. Small medium enterprises are benefited a lot with this subscription based service. You can add and remove users in minutes and pay for what you use.

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