Video: Office 365 vs

Microsoft Office 365 is commercial software plus services offering a set of products from Microsoft. Office 365 includes the Microsoft Office suite of desktop applications and hosted versions of Microsoft's Server products (including Exchange Server, SharePoint Server, and Lync Server), delivered and accessed over the Internet, in effect, the next version of Business Productivity Online Suite (BPOS). Office 365 free alternatives are Zoho, Google Apps.
Cloud-based email service that ties into SkyDrive, so you have 7GB of free space, and it can open attachments right inside new Web apps for Word, Excel and PowerPoint. Its built-in Outlook chat connects to Facebook messages. Outlook’s address book connects to Facebook, Twitter, Gmail, LinkedIn and other services, so contact info will update automatically when friends change their profiles. Microsoft also provides alternative for business - Office 365 Mail
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2012 - Microsoft rolls out to replace Hotmail to defeate Office 365

Microsoft loves to rename its applications and services and even the untouchable email service Hotmail will soon become Yesterday, Microsoft has launched a preview of What's new in comparison with Hotmail? First, the interface, which (like in other new Microsoft systems) is adapted to finger-controlled tablets. Secondly, it's tightly integrated with SkyDrive. After registration user automatically gets 7 GB of storage. Document attached to coming messages can be viewed in the online Office Web Apps or photo viewer. Files that you want to send can be quickly uploaded to SkyDrive and sent as download links (by the way, GMail still doesn't provide this feature for some reason). The third new feature - is integration with Facebook, Twitter, Gmail, LinkedIn, which allows to automatically update the contact list and see the social profile of the user who sent you a message.

Microsoft believes that the main advantage over GMail are advanced spam protection (and they have a reason to tell this) and that doesn't read the text messages for displaying ads. Ads in are displayed not in messages, but on the list-views, and they are not personalized.

But the most interesting feature may appear in the end of the year - integration with Skype.