Microsoft lures nonprofits with Office 365 freebie

Nonprofit organizations will be able to sign up for Office 365 for free or at a reduced price as part of a new program Microsoft launched on Tuesday.

Properly certified nonprofit and nongovernmental organizations (NGOs) in 41 countries can apply to the Office 365 for Nonprofits program. Microsoft expects to offer the program in 90 countries by July.

“Nonprofits are seeing more and more the advantages of cloud computing, but they often can’t access it because of costs and other reasons,” said Lori Harnick, general manager of Microsoft’s Citizenship & Public Affairs group.

While Microsoft has had a software donation program for years, this is the first time it will offer Office 365 in this manner, she said.

Customers can subscribe to the Office 365 Enterprise E1 plan for free for an unlimited number of seats. This plan, which normally costs US$8 per user, per month, includes Exchange Online, SharePoint Online, Lync Online and the browser-based Office Web Apps.

For an additional per user, per month charge of $2, customers can get the full Office ProPlus productivity application suite streamed down and installed on users’ desktops. Exchange Online Archiving costs $1 per user, per month extra.

Customers also have the option of signing up for Office 365 Enterprise E3 at $4.50 per user, per month, a reduction from the regular price of $20 per user, per month.

Later on, Office 365 Nonprofits will add two more options specifically for organizations with 25 and fewer users: Office 365 Small Business for free, which normally costs $60 per user, per year (or $6 per user, per month); and Office 365 Small Business Premium for $2 per user, per month, down from its regular price of $150 per user, per year (or $15 per user, per month).

While it’s a good move to cater to nonprofits with Office 365, Microsoft is following rival Google, which has had a free nonprofit edition of its Apps email and collaboration suite since 2007.

“My take is that Google Apps for Nonprofits was doing very well in the market, and Microsoft needed to combat Google’s inroads with a more attractive Office 365 no fee offer,” Gartner analyst Matt Cain said via email.

However, a difference is that Apps for Nonprofits is only available in the U.S., England and Wales.

In addition to giving Office 365 a competing offer among nonprofits against Google Apps, the product earns Microsoft points for corporate citizenship, according to TJ Keitt, a Forrester Research analyst.

“It provides organizations performing public services an affordable tool for communication and collaboration,” he said via email.

Moreover, this nonprofit offering expands the pool of people exposed to Office 365, potentially creating future customers for the paid editions, Keitt said.