Microsoft 365 Could Replace Office 365 And With Lots Of Windows Perks

Under Satya Nadella's leadership, Microsoft has made no bones about embracing subscription services for their products. Office 365 has largely phased out its perpetual licensed counterpart - e.g. Office 2019 - by enticing users with a low up-front cost, continual updates, and additional perks utilizing Microsoft's cloud services. According to Nadella, Microsoft is now looking to differentiate the subscription package further. 

"I think about Microsoft 365 as a two-sided market," says Satya Nadella. "What we are doing with Office 365 or what we will soon be talking about as Microsoft 365 consumer subscriptions, those would be again completely consumer businesses."

Microsoft 365 is not a new term. It already exists for business customers whose Enterprise tier bundles together Windows 10 Enterprise and Office 365 into a single license. However, on this new consumer front, the inclusions are less certain. At a minimum, we can assume the Microsoft 365 Consumer bundle will include Office 365, Skype, OneDrive, and possibly Outlook Mobile.

It is unclear if the Microsoft 365 Consumer subscription will include any Windows 10 licensing. The majority of Office 365 Home users already have an operating system either in the form of Windows 10 or macOS. Still, Microsoft could release additional features for Windows 10 users to take advantage of the subscription, similar to how Windows Home and Pro versions are distinguished now.


Nadella's remarks follow recent job postings for Microsoft 365 Consumer Subscription product manager and senior product manager positions. These positions are a part of the "Modern Life and Devices Team" which oversees Office 365, Skype, Cortana, Bing, Microsoft Surface devices, and Microsoft's Education Team. This relation reinforces our speculation about Microsoft 365's potential inclusions.

Microsoft has not released any information regarding potential price changes. If Microsoft 365 is indeed offering additional perks over the current Office 365 offerings, a price bump may be expected. However, most subscribers are likely to only care about the core Office service regardless and be put off by having to pay for more than they want.

One thing is for certain, subscriptions have been a powerful revenue generator for companies. We should not expect to see that momentum slowing as consumers get billed to death - a few dollars a month at a time. Hopefully Microsoft will deliver clarifications about this new branding sooner rather than later.