Verdict
Google Apps has a flat price of 33 per user per year; Office 365 has a range of prices from 6.50 to 17.75 a month, depending on whether you want Office, Office Web Apps, SharePoint, Lync or archiving it can be more expensive but you can choose what services you want to pay for and there are discounts for volume pricing (including transferring existing Exchange and SharePoint server licences to Office 365).
Google Apps is in a constant state of flux.
Google Apps is in a constant state of flux; the whole service is migrating to a new platform, there are two versions of the control panel available, there are options to give users access to previews of new interfaces and features from Google Labs which itself is going away, with no indication of what happens to the features it provides and new features like return receipts arrive periodically. Getting continuous, instant improvements is one of the benefits of cloud services, but if you're managing the service and supporting users you might prefer Microsoft's approach where updates come at regular intervals and you can choose whether to adopt them immediately or by a specific date.
That underlines one key difference between the two services that has little to do with features; Office 365 has the professional feel of a service planned in advance and designed for administrators; Google Apps has the feel of a service that has grown by leaps and bounds, but sometimes in a rather haphazard way that's not always consistent.
In the end, the two services are both powerful but they suit different audiences.
In the end, the two services are both powerful but they suit different audiences. If your business already uses Microsoft tools, Office 365 is the logical progression, giving you server workloads that integrate with and make the most of your existing investments. It's a comprehensive, powerful, end-to-end cloud platform for business that doesn't make you do everything online, which many businesses find a step too far. You can have all the power of Exchange and SharePoint without the bother of configuring and running them.
If you need a mix of on-premise and cloud services, having to manage both Active Directory and the Google Apps control panel is more work than being able to do everything through System Center. Google Apps is a better fit for businesses starting from scratch online with no legacy systems who can benefit from the simplicity without having to keep the service in sync with on-premise tools, but it has definite limits.
MICROSOFT OFFICE 365 SYSTEM REQUIREMENTS Operating system: Windows XP SP3 or later; MacOS X Leopard 10.5 or later; Windows Server 2003 or later Office client: Office 2007 SP2; Office 2008 or later; Lync 2010 Administration and Office Web Apps: a modern web browser Active Directory-based features: single forest GOOGLE APPS SYSTEM REQUIREMENTS Modern web browser
