The new Microsoft Office has two purchasing options, you can buy the software outright (as usual) or you can buy Office365 for a monthly fee. Basically, Office 365 if Office (Word, Powerpoint, Excel, etc.) on the cloud. You can install office on your PC, laptop, smartphone, tablet, etc. Well, you aren’t really installing Office. You are installing a program that you can connect through the internet and get to Excel. In essence, Excel is stored in the internet and you can get to it from any device you own.
For people who don’t want to deal with Office upgrades, the yearly fee might be a good choice.
Files for Office 365 are stored on OneDrive. This is a service like Dropbox. If you haven’t heard of either one, they are folders that look like they are on your pc/laptop/phone/tablet but they are really on the web. The folder can be accessed from any device; it acts as a central storage place where you can always have access to your files (Excel, Word, Powerpoint, pictures etc.). Note that you can use OneDrive with Office 2013 and/or Office365.
The new newsworthy item is that for Office 365 users, Microsoft has agreed to give a free 1 Terabyte of data, everyone else gets 15 Gb. OK trust me on this…1 Terabyte is a HUGE amount of space.
Here is more info on this change from PCWorld.com: http://www.pcworld.com/article/2365911/onedrive-goes-to-a-terabyte.html