The cost logic of the two models
Office 2024 as a perpetual licence is a one-time expense. After that there are no further costs; the software is used indefinitely. Microsoft 365, by contrast, costs you every year anew; the amount adds up with each renewal.
This gives rise to a tipping point. In the first one to two years, the subscription can seem cheaper because of the lower entry amount. After that the picture reverses: the perpetual licence is paid off, while the subscription keeps running. For a single user, this tipping point usually falls at around two years.
Three and five years compared
- First year. The subscription can seem cheaper, since only one annual amount is due. The perpetual licence is the one-time, somewhat higher expense.
- After three years. Three annual subscription amounts against a single one-time purchase price. For single users, the perpetual licence is usually already cheaper here.
- After five years. The gap widens significantly. The perpetual licence has incurred no further costs since year one.
- When the subscription makes sense. For multi-person plans with many active users and a genuine need for the cloud, the subscription can be cheaper per head.