When Microsoft introduced, it was lambasted for not offering a free version, as Google has for its not-quite-comparable Google Apps service. But now Google Apps is no longer available for free either. Was Microsoft’s pricing model always correct?
Note: I was among those who have argued that Microsoft should offer a free Office 365 tier, for individuals and very small companies (5 or fewer users), in order to better compete with Google.
“Google Apps is used by millions of businesses,” Google director Clay Bavor writes in a post to the Google Enterprise Blog. “When we launched the premium business version we kept our free, basic version as well. Both businesses and individuals signed up for this version, but time has shown that in practice, the experience isn't quite right for either group.”
Going forward, Google will provide standard web apps like Gmail, Google Calendar, and Google Drive to individuals for free. But those who want Google Apps, which includes 24/7 phone support and a 99.9 percent uptime guarantee, will need to pay. The cost is $50 per user per year.
By comparison, Microsoft’s cheapest Office 365 tier, the small business offering, costs $6 per user per month, or about $72 a year. In my opinion, the superiority of Office 365 more than compensates for this difference, but opinions vary.
Google will also continue offering Google Apps for Education as a free service for schools and universities.
Update: Should have added that Google says "this change has no impact on existing customers."