There are potentially big savings in migrating tools to the cloud. Online meetings reduce the need for business travel, and Web and mobile apps enable workers across oceans to work on the same page, literally, at the same moment. Plus, outfitting employees with software that works in a Web browser means there's little need to install local applications, then manage updates and patches. You may not even need to equip workers with computers--or outfit headquarters with a server room and IT staff.
Office 365 combines online editions of Word, Excel, PowerPoint, and OneNote, with Exchange for mobile calendar and e-mail access. There's also SharePoint for an intranet and shared documents; and Lync for IM, online meetings, and audio and video calls. An extra fee covers Microsoft Office Professional Plus software, including Outlook for e-mail and calendars. Read more about what's inside Office 365 here, and tour its tools for end users and business managers.
Google Apps for Business includes Docs, Spreadsheets, Presentations, Gmail, Calendar; Groups for group collaboration; Sites for intranets. Google also offers a bunch of stuff not quite found in Office 365--but that you can get even without a Google Apps subscription--such as Reader, AdWords, Picasa, and Blogger.
Then there's the Google Apps Marketplace. Similar to Apple's genius move of inviting third parties to build apps for the iPhone, Google invites anyone to create tools for Apps for Business. There are apps for CRM, payroll, and accounting, just to start.
These packages differ, by the way, from the free consumer services they include--and which are probably enough for most home-based businesses. Microsoft Office Web Apps is the name for online versions of Word, Excel, PowerPoint, and OneNote. And the regular Google Apps include Gmail, Calendar, Docs, Spreadsheets, Presentations, Sites, and services such as AdWords and Reader.
Office 365 starts at $6 per user per month, while Google Apps for Business is slightly cheaper at $50 per year, which amounts to $4.17 monthly per seat. However, Microsoft provides a nice incentive for paying for Office Professional Plus as a monthly fee, far more affordable than the retail price of the desktop software (although that's a different story if your company already enjoys a volume license discount).
Which Will Win?