When deciding between Office 2021 and Microsoft 365 (formerly known as Office 365), it’s essential to understand their key differences. Both versions of Microsoft’s Office suite cater to various needs and offer different features, pricing models, and benefits. Whether you are an individual user, a small business owner, or part of a larger organization, this comparison will help guide you in choosing the right option for your needs.
1. Introduction: Office 2021 vs. Microsoft 365
Office 2021 is a standalone, one-time purchase version of Microsoft’s productivity suite. It offers lifetime access to core applications like Word, Excel, PowerPoint, and Outlook but does not include continuous feature updates.
Microsoft 365, on the other hand, is a subscription-based service that offers regular updates, new features, and a broader range of tools. In addition to the traditional Office applications, Microsoft 365 includes cloud services like OneDrive, SharePoint, and Microsoft Teams, making it more suitable for collaboration and remote work.
2. Key Differences: Office 2021 and Microsoft 365
- Pricing Model: Office 2021 requires a one-time payment for lifetime access, while Microsoft 365 follows a subscription-based pricing model with ongoing monthly or annual fees.
- Updates: Microsoft 365 regularly updates and introduces new features, while Office 2021 does not receive major feature updates after purchase.
- Cloud Integration: Microsoft 365 has seamless integration with cloud services and collaboration tools, whereas Office 2021 is primarily designed for offline use.
- Flexibility: Microsoft 365 can be installed on multiple devices, offering more flexibility, while Office 2021 is limited to a single device license.
3. Pricing and Plans
Office 2021 Editions and Pricing
Office 2021 is available as a one-time purchase, meaning you pay once for the software, and it’s yours to keep forever. However, it comes with limitations such as no feature updates or access to cloud services. Below are the main editions:
| Edition | Included Applications | Price (One-Time Purchase) |
|---|---|---|
| Office Home & Student 2021 | Word, Excel, PowerPoint, OneNote | $149.99 |
| Office Home & Business 2021 | Word, Excel, PowerPoint, Outlook, OneNote | $249.99 |
| Office 2021 Professional Plus | Word, Excel, PowerPoint, Outlook, OneNote, Access, Publisher, Skype for Business | ~$439.99* |
Office 2021 Professional Plus is designed for professionals and businesses requiring advanced tools such as Access and Publisher, along with Skype for Business for communication.
- Prices for Office 2021 Professional Plus can vary depending on the vendor or licensing agreement.
* Pricing may vary based on purchasing channels such as volume licensing or business-specific pricing models.
Microsoft 365 Plans and Pricing
Microsoft 365 is available through monthly or annual subscriptions, which provide access to the latest features and updates. Multiple plans are available, catering to individuals, families, and businesses:
| Edition | Included Applications & Features | Price (Subscription) |
|---|---|---|
| Microsoft 365 Personal | Word, Excel, PowerPoint, Outlook, OneNote, Access (PC only), Publisher (PC only), 1TB OneDrive cloud storage, Microsoft Teams | $6.99/month or $69.99/year |
| Microsoft 365 Family | Word, Excel, PowerPoint, Outlook, OneNote, Access (PC only), Publisher (PC only), 1TB OneDrive cloud storage per user (up to 6 users), Microsoft Teams | $9.99/month or $99.99/year |
| Microsoft 365 Business Basic | Web and mobile versions of Word, Excel, PowerPoint, Outlook, Microsoft Teams, 1TB OneDrive cloud storage, SharePoint | $5/user/month |
| Microsoft 365 Business Standard | Full desktop versions of Word, Excel, PowerPoint, Outlook, OneNote, Access (PC only), Publisher (PC only), Microsoft Teams, 1TB OneDrive, SharePoint, advanced security tools | $12.50/user/month |
| Microsoft 365 Apps for Business | Desktop versions of Word, Excel, PowerPoint, Outlook, OneNote, Access (PC only), Publisher (PC only), 1TB OneDrive cloud storage, Microsoft Teams | $8.25/user/month |
| Microsoft 365 Enterprise E3 | Full suite of Office apps, 1TB OneDrive, advanced security, compliance tools, unlimited archive, Microsoft Teams, SharePoint, Exchange | $36/user/month |
- Microsoft 365 Personal is designed for individual users and provides access to all Office applications, cloud storage, and basic collaboration tools.
- Microsoft 365 Family allows up to 6 users, making it a cost-effective option for families or groups, with each user receiving their own 1TB of cloud storage.
- Microsoft 365 Business Basic offers web and mobile versions of the apps, making it ideal for businesses that work primarily online, with integrated Microsoft Teams for collaboration.
- Microsoft 365 Business Standard includes full desktop versions of the apps, offering more functionality and advanced security features, making it suited for small to medium-sized businesses.
- Microsoft 365 Apps for Business provides access to the core Office apps without advanced business tools like Teams or Exchange, ideal for users who only need the Office suite.
- Microsoft 365 Enterprise E3 is a comprehensive plan designed for large organizations, offering enterprise-grade security, compliance tools, and extensive collaboration capabilities.
This table provides a clear comparison of the various Microsoft 365 editions and their corresponding pricing to help users or businesses make the best decision for their needs.
4. Applications and Features
Office 2021:
- Core applications: Word, Excel, PowerPoint, and Outlook (depending on the edition).
- Lacks real-time collaboration and advanced cloud-based services.
- Features remain static after purchase, without access to future enhancements.
Here is a breakdown of the applications included in the different editions of Microsoft Office 2021:
| Application | Office Home & Student 2021 | Office Home & Business 2021 | Office 2021 Professional Plus |
|---|---|---|---|
| Word | Yes | Yes | Yes |
| Excel | Yes | Yes | Yes |
| PowerPoint | Yes | Yes | Yes |
| OneNote | Yes | Yes | Yes |
| Outlook | No | Yes | Yes |
| Access | No | No | Yes (PC only) |
| Publisher | No | No | Yes (PC only) |
| Skype for Business | No | No | Yes |
- Office Home & Student 2021 includes the core applications: Word, Excel, PowerPoint, and OneNote.
- Office Home & Business 2021 adds Outlook, making it suitable for small business professionals.
- Office 2021 Professional Plus includes Access, Publisher, and Skype for Business, making it the most comprehensive option for businesses that require database management and desktop publishing tools.
This list gives a clear overview of the apps available in each edition, making it easier to choose the one that best suits your needs.
Microsoft 365:
- Includes all the apps in Office 2021, plus Access (for PC) and Publisher.
- Provides access to cloud services like OneDrive (1TB per user), Microsoft Teams, and SharePoint.
- Advanced features such as AI-powered tools, real-time co-authoring, and PowerPoint Designer.
- Regular feature updates and security patches as part of the subscription.
Here’s a breakdown of the key applications and features included across different Microsoft 365 plans:
| Application/Service | Microsoft 365 Personal | Microsoft 365 Family | Microsoft 365 Business Basic | Microsoft 365 Business Standard | Microsoft 365 Enterprise (E3) |
|---|---|---|---|---|---|
| Word | Yes | Yes | Web/Mobile Only | Yes | Yes |
| Excel | Yes | Yes | Web/Mobile Only | Yes | Yes |
| PowerPoint | Yes | Yes | Web/Mobile Only | Yes | Yes |
| Outlook | Yes | Yes | Web/Mobile Only | Yes | Yes |
| OneNote | Yes | Yes | Yes | Yes | Yes |
| Access (PC Only) | Yes | Yes | No | Yes | Yes |
| Publisher (PC Only) | Yes | Yes | No | Yes | Yes |
| Microsoft Teams | Yes | Yes | Yes | Yes | Yes |
| OneDrive (1TB Storage) | Yes (1TB) | Yes (1TB per user) | Yes (1TB per user) | Yes (1TB per user) | Yes (1TB per user) |
| SharePoint | No | No | Yes | Yes | Yes |
| Exchange | No | No | Yes | Yes | Yes |
| Skype for Business | Yes | Yes | Yes | Yes | Yes |
| Yammer | No | No | No | No | Yes |
| Power Automate | No | No | No | No | Yes |
| Power BI | No | No | No | No | Yes |
- Microsoft 365 Personal & Family: Both offer the core Office applications (Word, Excel, PowerPoint, Outlook, OneNote) and cloud storage, with Access and Publisher available for PC users. Microsoft Teams is included for communication, making it suitable for individual users or families.
- Microsoft 365 Business Basic: Web and mobile-only versions of Word, Excel, and PowerPoint, plus access to Microsoft Teams, OneDrive, SharePoint, and Exchange for businesses that need basic online collaboration.
- Microsoft 365 Business Standard: Includes full desktop versions of all Office apps and collaboration tools like Teams and SharePoint, designed for small to medium-sized businesses.
- Microsoft 365 Enterprise (E3): A comprehensive plan for large organizations, featuring advanced security, compliance tools, and additional services like Yammer, Power Automate, and Power BI.
This detailed breakdown highlights the wide variety of applications and services offered through Microsoft 365, catering to different needs from individuals to large enterprises
5. Updates and New Features
Office 2021:
- No new feature updates once purchased.
- Only receives essential security patches.
Microsoft 365:
- Continuous updates with new features, AI-driven improvements, and cloud integration enhancements.
- Access to the latest productivity tools as they are released.
Key Takeaway: Microsoft 365 is ideal if you want to stay on the cutting edge of productivity tools, whereas Office 2021 provides stability without new features.
6. Collaboration and Cloud Integration
Office 2021:
Office 2021 is designed primarily for offline use, but it does include some limited collaboration and cloud integration features. However, its capabilities in these areas are significantly more basic compared to Microsoft 365. Here’s an overview of the collaboration and cloud integration tools available in Office 2021:
1. Limited Cloud Integration
- OneDrive Compatibility: Office 2021 allows users to save documents to OneDrive, Microsoft’s cloud storage service, enabling access to files from anywhere. However, this functionality is more limited compared to Microsoft 365, as it lacks real-time syncing and advanced cloud features.
- Manual Sharing: Files can be manually shared via OneDrive by sending links or uploading to shared folders. This method requires manual updates and lacks the dynamic collaboration features of cloud-first solutions like Microsoft 365.
2. Basic Collaboration Features
- Co-Authoring (Limited): Office 2021 supports basic co-authoring features, allowing multiple users to work on documents simultaneously. However, this feature is less seamless than in Microsoft 365, as real-time updates may not be as fluid or instant due to a lack of full cloud-based integration.
- Word, PowerPoint: Co-authoring is available in Word and PowerPoint, but the user experience may vary based on network stability and access to OneDrive.
- Excel: Limited co-authoring functionality is available, but advanced features like real-time data updates and collaboration tools are restricted.
3. No Microsoft Teams Integration
- No Built-in Microsoft Teams: Unlike Microsoft 365, Office 2021 does not come with Microsoft Teams, a popular tool for meetings, chats, and collaborative workspaces. This significantly limits the ability to engage in real-time collaboration across teams or organizations.
4. Offline Focus
- Primarily Offline Use: Office 2021 is designed to function offline, making it more suitable for users who don’t need frequent internet access or real-time collaboration. It is ideal for individuals or small businesses that do not rely on cloud collaboration.
5. Manual File Syncing
- Manual File Sync: Users of Office 2021 must manually sync files with OneDrive or other cloud storage services. This contrasts with Microsoft 365’s automatic syncing and cloud integration, where files are continually updated across devices in real time.
Microsoft 365:
Microsoft 365 excels in cloud integration and collaboration, making it a robust solution for businesses, teams, and individuals who need seamless, real-time collaboration tools and cloud-based access to their documents and projects. Here’s an overview of the collaboration and cloud integration features that set Microsoft 365 apart:
1. Full Cloud Integration
- OneDrive (1TB Storage Per User): Every Microsoft 365 plan comes with 1TB of OneDrive cloud storage per user. OneDrive allows automatic syncing of files across devices, ensuring that your documents are always up-to-date and accessible from anywhere.
- Real-Time Syncing: Files saved in OneDrive are continuously synced across all devices, meaning that any changes made are reflected in real-time. Whether you’re using a PC, Mac, tablet, or smartphone, your data is always accessible.
- Cloud Access from Anywhere: Since Microsoft 365 is cloud-based, users can access all their documents, presentations, and spreadsheets from any device with an internet connection. This is ideal for remote work or on-the-go access.
2. Advanced Collaboration Tools
- Real-Time Co-Authoring: One of the key features of Microsoft 365 is real-time co-authoring, where multiple users can work on the same document, spreadsheet, or presentation simultaneously. This feature is available across Word, Excel, and PowerPoint, allowing teams to edit and comment on documents in real-time.
- Track Changes Instantly: Users can see the changes made by collaborators in real time, reducing the need for back-and-forth emails or file versions.
- Collaboration Across Devices: Co-authoring works across devices, enabling users to collaborate from their PCs, tablets, or phones.
- Microsoft Teams Integration: Microsoft 365 includes Microsoft Teams, a powerful tool for team collaboration, meetings, and communication. Teams allows users to:
- Host video and audio meetings.
- Collaborate on shared files directly from Teams, with real-time co-authoring.
- Communicate via chat, share files, and manage projects from one unified platform.
- Channels and Workspaces: Teams allow the creation of dedicated channels for specific projects or departments, promoting organized and efficient collaboration.
3. SharePoint for Enterprise Collaboration
- SharePoint Integration: For businesses and enterprises, SharePoint is included in Microsoft 365, allowing for centralized document storage, workflow automation, and advanced collaboration.
- Document Libraries: SharePoint enables the creation of document libraries, where teams can store, manage, and access files in a shared workspace.
- Workflow Automation: Through SharePoint, businesses can automate workflows, approvals, and document version control.
4. Integration with Other Microsoft Services
- Outlook and Calendar: Seamless integration with Outlook and shared calendars allows for better scheduling, communication, and meeting planning across teams.
- Planner and Microsoft To Do: Microsoft 365 includes tools like Planner for project management and Microsoft To Do for task management, helping teams stay organized and on track with their tasks and deadlines.
- Yammer: Microsoft 365 also integrates with Yammer, a social networking tool for enterprises, promoting communication and collaboration across large organizations.
5. Cross-Device Compatibility
- Work Across Devices: Microsoft 365 is compatible with all major devices, including Windows, macOS, iOS, and Android. Users can start a project on one device and seamlessly continue it on another without missing a beat.
- Mobile Apps: Microsoft 365 mobile apps (Word, Excel, PowerPoint, OneNote, Teams) offer similar functionality to their desktop counterparts, making it easier for users to work on the go.
6. Security in the Cloud
- Built-in Security Features: Microsoft 365 provides enterprise-grade security features, such as data encryption, multi-factor authentication (MFA), and threat detection. These features ensure that files and data remain secure while collaborating in the cloud.
- Version Control and File Recovery: Microsoft 365 offers version history, allowing users to track changes and revert to previous versions of files. In case of accidental deletion or changes, files can be restored from OneDrive or SharePoint.
7. Seamless Integration with Third-Party Apps
- Integration with Third-Party Tools: Microsoft 365 integrates with popular third-party apps like Slack, Trello, Zoom, and other tools, making it a flexible platform for businesses that use a combination of tools for collaboration.
7. Licensing and Device Compatibility
Office 2021:
Office 2021 offers a traditional licensing model that differs significantly from the subscription-based model of Microsoft 365. Here’s a detailed overview of how licensing and device compatibility work with Office 2021:
1. One-Time Purchase Licensing
- One-Time Payment: Office 2021 is available as a one-time purchase, meaning you pay once upfront, and you own the software for the lifetime of the device it is installed on. There are no recurring monthly or yearly subscription fees.
- Perpetual License: With a perpetual license, you have access to the software indefinitely, although you will not receive any future feature updates—only security patches and bug fixes.
- Limited to One Device: Each license of Office 2021 is tied to a single device, meaning that the software can only be installed on one PC or Mac at a time. If you need Office on multiple devices, you will have to purchase additional licenses.
2. Device Compatibility
- PC and Mac Support: Office 2021 is compatible with both Windows and macOS platforms, so you can choose the version that suits your operating system.
- Windows Version Requirements: Office 2021 requires Windows 10 or later.
- macOS Version Requirements: Office 2021 for Mac requires macOS Catalina (10.15) or later.
- No Mobile Device Installation: Unlike Microsoft 365, which allows you to install Office apps on mobile devices, Office 2021 does not come with the ability to install the full desktop apps on smartphones or tablets. You can still access some Office features via web apps or mobile versions, but these are more limited in functionality.
3. License Transferability
- Transferability Rules: Office 2021 licenses can generally be transferred to a new device, but there are restrictions:
- If you buy a new computer, you can transfer your Office 2021 license to the new machine as long as you uninstall it from the old one.
- The process typically involves reactivating the software on the new device, which may require contacting Microsoft support if activation issues arise.
4. Offline Usage
- No Internet Required: Office 2021 is fully functional offline, making it an ideal choice for users who work without regular internet access. You don’t need to be connected to the internet to use any of the core applications (Word, Excel, PowerPoint, etc.).
- No Cloud-Dependent Features: While some basic cloud features (like saving to OneDrive) are available, Office 2021 is not as tightly integrated with cloud services as Microsoft 365. This makes it a good choice for users who prioritize local storage and offline work.
5. No Multi-Device Flexibility
- Single Device Restriction: Since each Office 2021 license is limited to one device, you cannot easily switch between devices. If you work across multiple devices (such as a laptop and desktop), you will need to purchase separate licenses for each machine.
- No Concurrent Logins: Unlike Microsoft 365, which allows you to log in to multiple devices under one account, Office 2021 does not offer concurrent login capabilities across multiple devices.
Microsoft 365:
Microsoft 365 uses a flexible subscription-based licensing model, making it highly adaptable for various user needs, from individual users to large businesses. The subscription model provides continuous updates, cloud access, and the ability to use Office apps on multiple devices. Here’s a detailed look at how licensing and device compatibility work with Microsoft 365:
1. Subscription-Based Licensing
- Monthly or Annual Subscription: Microsoft 365 is available through a subscription model, which can be paid either monthly or annually. The subscription covers access to all Office apps, cloud services, and continuous feature updates.
- Plans for Individuals, Families, and Businesses:
- Microsoft 365 Personal: For individual users with a single subscription license.
- Microsoft 365 Family: Covers up to 6 users with one subscription.
- Microsoft 365 Business and Enterprise Plans: Tailored for businesses and organizations, offering licenses on a per-user basis with options for advanced tools, security, and collaboration features.
- Continuous Updates: As part of the subscription, Microsoft 365 users receive regular updates, including new features, security patches, and performance enhancements. This ensures that users always have the most up-to-date version of the software without needing to purchase new versions.
2. Multi-Device Compatibility
- Use on Multiple Devices: One of the key benefits of Microsoft 365 is the ability to install Office apps on multiple devices under a single subscription. You can install the full suite of Office apps (Word, Excel, PowerPoint, Outlook, etc.) on:
- PCs and Macs
- Tablets (iOS and Android)
- Smartphones (iOS and Android)
- Cross-Device Usage: Microsoft 365 allows you to install the Office apps on up to five devices simultaneously under a single account (depending on the plan). This includes any combination of PCs, Macs, tablets, and smartphones.
- For example, with Microsoft 365 Personal, you can use the suite on one computer and multiple mobile devices simultaneously.
- Microsoft 365 Family allows up to 6 users to install apps on multiple devices with 1TB of OneDrive storage per user.
- Real-Time Syncing Across Devices: Documents and files are synced across all devices via OneDrive, meaning you can start a project on your desktop and continue working on it from your tablet or smartphone seamlessly.
3. Online and Offline Access
- Work Offline: Microsoft 365 apps are fully functional offline, allowing users to create and edit documents without an internet connection. Once you reconnect, any changes made offline will automatically sync to the cloud via OneDrive.
- Cloud Access: With 1TB of cloud storage per user via OneDrive, Microsoft 365 emphasizes cloud-based collaboration and access. Documents, spreadsheets, and presentations can be stored in the cloud and accessed from any device with an internet connection.
4. Concurrent Logins and Account Flexibility
- Concurrent Logins: Microsoft 365 allows users to be logged in to multiple devices at the same time, facilitating seamless transitions between devices. This is particularly useful for people who work across different devices (e.g., switching between a laptop, desktop, and mobile device throughout the day).
- User Profiles for Families and Teams:
- With Microsoft 365 Family, up to six users can have individual profiles, with each user enjoying their own 1TB of OneDrive storage and personalized Office experience.
- Each user can install Office apps on their devices and manage their documents independently.
5. License Flexibility for Businesses
- Per-User Licensing for Businesses: For businesses, Microsoft 365 operates on a per-user licensing model. This means each employee or user gets their own license and can use Office apps on up to five devices. This is ideal for businesses with employees who work across multiple devices.
- Scalable Licensing: Business and enterprise users can scale their Microsoft 365 licenses according to their needs. For instance, businesses can add or remove user licenses as their team grows or shrinks, making the licensing structure highly flexible.
6. License Management and Transferability
- Device Deactivation and Reactivation: If you reach the device limit (e.g., installing Office apps on five devices), you can deactivate one device and activate a new one without needing to purchase a new license. This is particularly useful when upgrading to new devices.
- License Transfer: With Microsoft 365, licenses can easily be transferred to new devices, allowing users to deactivate and reactivate installations as needed without additional costs or administrative headaches.
7. Access to Web Apps
- Web Versions of Office Apps: In addition to the full desktop versions, Microsoft 365 also provides access to web versions of Office apps, such as Word, Excel, PowerPoint, and Outlook. These web apps can be accessed from any browser, making it easy to work from a public or shared computer without installing the full software.
8. Security and Support
Office 2021:
- Basic security updates, with no major feature updates.
- Support is limited after a new version is released.
Microsoft 365:
- Continuous security updates and performance enhancements.
- Advanced security features for businesses, including data loss prevention and multi-factor authentication.
- 24/7 support for business plans, with enhanced admin and management controls.
Key Takeaway: Microsoft 365 offers superior security and support, especially for businesses concerned about data protection and compliance.
9. Conclusion: Which is Better for You?
Choose Office 2021 if:
- You prefer a one-time purchase without recurring subscription fees.
- You don’t need ongoing updates or cloud-based collaboration tools.
- You work on a single device and primarily offline.
Choose Microsoft 365 if:
- You want regular updates and access to the latest features.
- You need cloud-based services, real-time collaboration, and multi-device flexibility.
- You are part of a team or organization that requires advanced productivity and collaboration tools.
Final Recommendation: If you’re an individual or small business looking for a cost-effective solution with basic Office applications, Office 2021 may be sufficient. However, for most users, especially those who work collaboratively or across devices, Microsoft 365 provides more value through continuous updates, cloud integration, and flexibility.
