Office 365 Vs Hosted Exchange: The 5 Biggest Differences

Microsoft has done a decent job of marketing its new online service but it could have done a bit better educating consumers as to what it actually is. Many of our clients have come to us wondering what the differences were between their current hosted solution and Office 365. While there are many nuances to this comparison it is good to get the 5 big ones out of the way to see if you are still interested before you delve into any of the smaller details.

  1. Limits
    Check your limits with your current provider. If you run an on-premise solution then there are no real limits. Your question may be more about Total Cost of Ownership vs. these limits. The main limits are:
  • 25GB Mailbox
  • 25MB attachments
  • 30 messages per minute/per user
  • 250 seat online meetings
    Blasting emails to hundreds of thousands of users? No good. 26 MB attachments? Look elsewhere. Additionally, if you are using Mail Enabled Lists in Sharepoint you will not be able to continue to use those in Office 365. (Mail enabled lists are listed within Sharepoint that you can email to. Sharepoint catalogues the mail and stores the attachments)
  1. The Hosting Company
    Who is currently hosting your solution? Office 365 is run and managed by Microsoft themselves with a financially backed 99.9% uptime guarantee. Your current provider may be doing 99.99% or higher but if you are running the chances of your own server are you’re not getting that type of up-time. The difference between 99.9% and 99.99% is 8.76 hours of unscheduled downtime per year vs. under 1 hour per year. You have to decide what type of downtime your company can withstand. We do like that Microsoft is backing the downtime guarantee financially since it puts Microsoft on the hook for a lot of money were they to have any outages.
  2. The Bundle
    Besides email are you getting Instant Messaging, Sharepoint, and Lync Online for meetings? Most are getting the first two but few are getting all three. Only you can answer if you actually need all three. Additionally, some plans come with versions of Office which we will get to later.
  3. This is 2019
    There are a few outfits out there that offer hosted Exchange that is using Exchange 2019. For a while, it was a differentiator. However, the entire Office 365 suite of products is the 2019 version. Exchange 2019, Sharepoint 2019, Lync 2019 and Office 2019. This brings us to perhaps what I consider to be the biggest difference.
  4. Office Professional Plus
    This is perhaps the biggest difference because it is in effect an entirely new way to license Office 2019. Instead of paying one large sum to receive a perpetual license of Office 2019 Professional Suite, this version of Office is subscription-based. You pay one low monthly fee and you can use the software locally on your machine as well their cloud-based counterparts when you are on a machine that doesn’t have Office installed. The Office Web Apps sit natively within Sharepoint. Simply click on a Word Document and select edit and you’re in a light but quite a functional version of Office.
    Additional customization is available through add-on services which are purchased through partners. You can fine-tune your spam, anti-virus controls and mail routing with Forefront Protection add-ons as well as receive more robust Archiving with Exchange Hosted Archiving.
    There is potentially one more difference that exists; price. The hosted offerings available run the gamut from $5/month to $20/month and up. The Office 365 offering provides several price points from as low as $10/month to the yet unreleased E4 Plan which includes a VoIP based PBX replacement for $27/month. To confuse things a bit more there are online-only “Kiosk Worker” versions which start at $4/month.
    These are your major considerations when weighing your current solution against Office 365.

John Abrams is a Microsoft Office expert and he has been working in the technology industry for the last 5 years. As a technical expert, he has written technical blogs, white papers, and reviews for many websites such as