Microsoft 365 (formerly Office 365) vs. Office 2016: a comparison of both models

Microsoft is known for constantly reinventing its products: and this also applies to its world-famous office package: with the introduction of Office 365 (Microsoft 365), the popular office software is now available for the first time in a subscription model. This new version has many advantages although many users and businesses aren’t sure what the differences between Microsoft 365 and Office 2016 are. Our comprehensive comparison of Microsoft 365 and Office 2016 aims to change this. The advantages and disadvantages of both models are explained below.

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Classic version vs. new subscription model: Office 2016 vs. Microsoft 365 (formerly Office 365)

The main differences between Microsoft 365 and Office 2016 relate to the distribution channel, functionality, and validity of the purchased license. It’s interesting to know that many applications that are included in Office 2016 are also contained in the Microsoft 365 subscription. The numerous individual Office 2016 and Microsoft 365 bundles give users even more variety.

Office 2016

If you opt for Office 2016, the purchasing process is barely any different from buying previous versions of Office. This means that you buy Office at a store or online for a one-time free and receive the full version of the software as per usual. Microsoft offers the software packages in five different versions, each of which differs regarding its range: the customary individual applications Word, Excel, PowerPoint, and OneNote are always included (e.g. in the smallest package 'Home & Student'). Larger packages (such as 'Home & Business') include the Outlook e-mail client. Office 2016 Professional provides you with even more such as the Publisher and Access applications. Office 2016 is available for Windows PCs (from Windows 7 onwards) as well as for Mac OS.

Please note that Office 2016 is no longer distributed on traditional data mediums. Instead, you buy a single license, which entitles you to download the software onto one computer. Be aware that the license is only valid for PCs and Macs! Therefore, you should pay close attention to the operating system for which you are purchasing the software. Since it’s a download, this means that an internet connection is required for Office 2016’s initial installation and setup. Once the software is installed on your computer, you don’t need an internet connection anymore. This means that you can also use the application when you’re on the move i.e. on your laptop on public transport.

In terms of price, there are some significant differences between the individual versions of Office 2016: the somewhat slimmed down 'Home & Student Version' without Outlook 2016 currently costs around $150 depending on the provider. Commercial users pay around one hundred dollars more for the 'Home & Business' version, but are able to use the software for business purposes and get Outlook included. In addition to the relatively high purchase costs, the big disadvantage of this model is that only the most necessary security updates are provided. New features that supplement subsequent Office releases are no longer available – at least until the next version of the software is purchased again at full price. Office 2016 also lacks an upgrade feature: the software comes as it is and there’s not much you can do to expand it.


Office 2016 is ideal for casual home users who don’t need to work on multiple devices and who don’t want to receive regular feature updates. You still get security updates. The model is also useful for users who prefer one-time purchases to monthly or annual debits.

Microsoft 365 (formerly Office 365)

On the contrary to a one-time purchase of Office 2016, you pay a monthly or annual feewith Microsoft 365 and this also includes the Office applications Word, Excel, PowerPoint, OneNote, and Outlook. Publisher and Access are also included for PCs. Unlike with the one-time purchase of the Office 2016 beginner versions 'Home & Student', these programs are also included in the low-cost packages 'Officer 365 Personal' and 'Microsoft 365 Family'. If you decide to pay the yearly fee, it is slightly cheaper than paying the monthly fee for a year. The individual license models and the corresponding prices have already been described in detail in one of our articles.

One of the most important differences between Microsoft 365 and Office 2016 is that with the subscription model, you always get the latest versions of the entire Office programs in addition to the full range of applications. This means that as soon as a new Office version is released, subscription users can upgrade without having to pay again. Regular feature updates are also included as well as the security updates contained in Office 2016.

If many users want to use the software, it is crucial that it can be installed on several devices with only one subscription. For example, Microsoft 365 Family lets you use individual applications on up to five devices, whether it’s Mac or PC. If you’re not using all the licenses, you can legally share them with other household members.

The range of functions is also extended to tablets and smartphones with Android and iOS, which a one-time purchased version doesn’t offer. On mobile devices, you can work with Microsoft 365 in Word using 'Track Changes', edit headers and footers, or insert section and page breaks. With Excel, you can also use shadow and mirror effects or insert WordArt, while PowerPoint’s features include freehand annotations and speaker notes. This extended set of features applies to five smartphones and five tablets. In addition, there is 1TB OneDrive cloud storage for each user on top of this, which isn’t included with Office 2016. Technical support from Microsoft is available during the entire subscription period, instead of only during the installation process.


compared to Office 2016, the low-cost subscription model Microsoft 365 is ideal for ambitious users and companies with multiple employees. Microsoft’s ongoing technical support, the upgrade feature, the generously-sized cloud storage and installation (regardless of the device) also speak volumes for the subscription.

Microsoft 365 (formerly Office 365) vs. Office 2016: Die Modelle im tabellarischen Vergleich

  Microsoft 365 Office 2016
Payment model Subscription (monthly/yearly) Retail version
Applications included Office Suite including Outlook for all devices. Access and Publisher are only available for PC Office Suite with Word, Excel, PowerPoint, and OneNote for PC or Mac. Outlook, Access, and Publisher only available in selected versions
Updates and upgrade possibilities • Security updates • Feature updates • Upgrades to newer Office versions • Security updates
Installation on several devices with a single license possible Yes. With 'Microsoft 365 Family' up to 5 PCs and/or Macs. No. One PC or one Mac per license.
Maximum number of users Pro Microsoft 365 Family license allows up to 5 users. For businesses, Microsoft offers specific models with an unlimited number of users One user per purchased license
Working on mobile devices possible With 'Microsoft 365 Family' up to 5 smartphones and 5 tablets is possible with extra functions Only basic editing functions available
Included cloud storage 1 TB OneDrive cloud storage per user None
Included Skype call minutes for landlines and mobiles 60 minutes per month per user None
Microsoft support During the whole subscription period Only during installation

With IONOS, you will receive the Microsoft 365 package with appealing conditions and with our usual premium service.