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September 3, 2021 | Updated on: April 23, 2024 | Reading time 9 minutes

Microsoft 365 vs. Office 365: How Backup & Ransomware Companies Confuse Buyers

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Product Manager

When choosing Microsoft products, buying team might get confused due to the abundance of products and features. One of the most frequent mistakes that buyers make is the confusion between Microsoft 365 vs. Office 365 subscriptions. And the recent rename of the latter didn’t make things easier.

When studying the backup market, Spin experts noticed that certain companies take advantage of this situation. They sell legacy products stating that they can back up and recover Office 365. In reality, it’s not always correct.

In this article, you’ll learn:

  • The difference between Microsoft 365 and Office 365 subscriptions
  • How legacy backup & ransomware protection companies take advantage of buyers’ confusion

Please keep in mind, that this article reviews only products for business and enterprise.

Microsoft Business Plans

Microsoft 365 vs. Office 365

Until recently, the key difference between these two products had been clear. Basically, M365 was an on-prem and cloud solution, while O365 was a cloud office suite.

In particular, Office 365 offered a number of classical applications (like Word, Excel, Outlook) available exclusively as a web version.

Meanwhile, Microsoft 365 was a set of products that included Windows 10, Office apps for both cloud and PC. Additional features for both M365 and O365 depended on the plan you chose.

You can still see the articles that describe on-prem+cloud vs. cloud-only as a key difference between the two products. This distinction confused many buyers then. And these articles were of great help in the purchasing process.

Office 365 becomes Microsoft 365

In 2020, Microsoft decided to rename and restructure its subscriptions. Some business plans of Office 365 became Microsoft 365, while some remained unnamed. The logic behind this step remains unclear.

As of 2021, Microsoft offers the following plans:

  1. For business:
  • Microsoft 365 Business Basic
  • Microsoft 365 Business Standard
  • Microsoft 365 Business Premium
  • Microsoft 365 Apps for business
  1. For enterprise:
  • Office 365 E1
  • Office 365 E3
  • Office 365 E5
  • Microsoft 365 E3
  • Microsoft 365 E5
  • Microsoft 365 F3
  • Microsoft 365 Apps for enterprise

Some differences between Office 365 and Microsoft 365 that had been critical before the subscription restructure remained.

For example, Windows is still a part of certain M365 plans (Microsoft Business Premium, Microsoft 365 E3, E5, and F3). Meanwhile, most subscriptions don’t have it.

On-prem apps aren’t present in Office 365 E1. However, they are also unavailable in Microsoft 365 Business Basic.

Microsoft 365 vs. Office 365
Office 365 Plans

The difference between M365 business and M365/O365 enterprise plans

We prepared a comparison table that shows the difference in key features of various M365 and O365 plans. For more information, please see the Microsoft official website.

 M365 Business PlansO365 E1-E5 PlansM365 E3 and E5 Plans
Price range (for an annual subscription)$5-20 user/mo$8-35 user/mo$32-57 user/mo
Maximum Users300UnlimitedUnlimited
Storage OneDrive1TB1TBUnlimited
Email Storage50 GB50 GB for E1,


100 GB for E3 & E5

100 GB
Office apps (Word, Excel, PowerPoint, OneNote)Installed (except for Basic Plan)Web-only for E1, Installed for E3 & E5Installed
Email (Outlook, Calendar)+++
TeamworkTeamsTeams, Webinars, Online meetings, Recond meetings. For E5: Phone System and Audio ConferencingTeams, Webinars, Online meetings, Recond meetings. For E5: Phone System and Audio Conferencing
Social & IntranetSharepointSharepoint + YammerSharepoint + Yammer
Work ManagementPower Apps, Power Automate, Power Virtual Agents, Forms, Planner, To-DoPower Apps, Power Automate, Power Virtual Agents, Forms, Planner, To-Do
Advanced analyticsMy Analytics, Power Bs ProMy Analytics, Power Bs Pro
Security & complianceBasic functions: spam and malware control, access control, password policies. For Premium: Advanced threat protection.Basic functions+ more complex security features, including Identity and access management.


For E5 also Advanced compliance, Information protection & Threat protection.

Basic functions+ more complex security features, including Identity and access management, threat protection, Advanced security & compliance, Information protection. E5 has a full list of features while in E3 some of the features might not be present.
Best forSMBsEnterprisesEnterprises looking for best security options

As you can see, all the above plans offer cloud storage solutions for business-critical data and tools for document collaboration. This means, that all Microsoft plans have transferred from on-prem to cloud solutions.

Most of them provide PC applications with immediate cloud synchronization. However, it’s important to remember that the key storage of your data is located in remote Microsoft data centers, the cloud.

Generally speaking, having your sensitive information stored in a cloud is a favorable thing for company security. However, there are hidden pitfalls.

Microsoft 365 Enterprise Plans

How Backup and Ransomware Companies Confuse Potential Customers

As mentioned above, Microsoft plans enable PC-cloud synchronization. This gives an opportunity to on-prem backup solutions claim that they backup Microsoft 365 or Office 365. Similar is true for on-prem ransomware protection tools. However, they fail to deliver results.

Let’s take a deeper look at the pitfalls for each case.

Legacy Backup Tools

It is true, that on-prem solutions back up the data stored on a user’s PC. However, it isn’t automatically applied to the cloud data. Therefore, under certain circumstances, the loss of the data will be irreversible. Let’s take a look at two examples:

  1. A PC hasn’t been connected to the internet (and thereby to OneDrive) for a long time.

In this case, an on-prem backup won’t be able to store the changes that happened in the cloud while the PC was disconnected. As a result, the information will be irreversibly lost.

  1. Synchronization is absent.

It has been disabled or hasn’t been enabled by mistake or for security purposes. In this case, no cloud data will be backed up by an on-prem tool and might be deleted or corrupted irreversibly.

On-prem Ransomware Protection

There’s a significant difference between on-prem and cloud ransomware. As a rule of thumb, cloud ransomware doesn’t affect endpoint devices and focuses on decrypting data in OneDrive. Similarly, on-prem protection tools can neither detect nor stop ransomware in the cloud. They also cannot recover decrypted files in OneDrive and other services.

The only thing they can do is restore files from synchronized folders. However, if your cybersecurity team hasn’t stopped the attack, all the new files that get to the cloud will be immediately infected.

Another important aspect to consider is the speed of recovery.

File restoration on PCs takes less time than in the cloud. However, the restoration to the cloud can take much more time because of the upload speed. Therefore, if 1 TB of data has been wiped out, it might take a while to recover it. 

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Product Manager

About Author

Will Tran is the Product Manager at Spin.AI, where he guides the product's strategic direction, oversees feature development and ensures that the solution solves his clients’ cybersecurity needs.

Will is a security professional who started his career at Lockheed Martin where he worked on National Security Space programs in business development and product management.

Will holds a BA in Economics and Mathematics from UCSB and an MBA with a specialization in Technology Management and Marketing from UCLA Anderson School of Management.

At Lockheed Martin, Will developed the multi-year strategy campaign and supported the product development of a national security satellite program for the United States Air Force, which resulted in a multi-billion dollar contract.

During business school, Will consulted 2 non-profit organizations as part of a series of national consulting case competitions. He set strategic priorities, optimized business operations, and developed a process to qualify new revenue streams for his non-profit clients. These initiatives resulted in 15-20% increase in annual surplus.

In his spare time, Will can be found at local coffee shops around Los Angeles, traveling to different countries, or hanging out with his cat.

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