Microsoft account vs Office 365 account

[June 16, 2016: an updated version of this article can be found here: Understanding Microsoft Work And Personal Accounts.]

Microsoft has taken great strides towards simplifying its products and services. It has discarded products that were overlapping (Live Mesh discarded in favor of Skydrive, Messenger discarded in favor of Skype), it has streamlined its product names (rebranding the Windows Live services, for example), and introduced the consistent interface used on Windows computers, servers, tablets and phones.

Nothing is ever simple with Microsoft. There are still areas where you can be hopelessly confused. Here’s something you need to understand if you want to take advantage of some of Microsoft’s best new services.

Microsoft has two different databases that have credentials for you – your email address and a password. They’re separate. They’re used for different things. It’s possible that someday Microsoft may come up with a way to combine them but right now it’s up to you to keep them straight. And in typical Microsoft fashion, they’re not used consistently.

Everyone can and should have a Microsoft account. It is an email address and a password; it might be your primary email address, or it might be a Hotmail or address. (You can use the Hotmail or address for email, if you choose, but you don’t have to – you might only use it to log into other services.) The Microsoft account can be used to log into a Windows 8 computer and it gives you access to online file storage with Skydrive, as well as a host of other services.

Separately – separately! – subscribers to Office 365 business plans have an Office 365 account. It is an email address and a password; it might be  your primary email address, or it might be (yourname)@(business) The Office 365 account is used to log into your mailbox (either in Outlook or in webmail) and other Office 365 services. It may also be the account that’s associated with your business subscription to Microsoft Office.

See how it works?

My Microsoft account is, with a complex password. That’s the one I type to log into my Windows 8 computer.

My Office 365 account is, with a different complex password. That’s the one I type to log into my mailbox.

For reasons that will become obvious, Microsoft sometimes distinguishes between a Microsoft account and an organizational account, as in this window that comes up when Office 2013 is first installed:

Office install - Microsoft account vs Organizational account

The key is remembering that the two accounts are separate. They can be the same email address; you can set the password to be the same, if you like; but they are separate accounts and Microsoft’s servers look in different databases to authenticate you for various services.

Here’s a quick overview.

microsoftaccountlogo office365logo3

Email address

– Your primary address
– Hotmail

– Your primary address

Used for

– Log into Windows 8
– Log into Windows Phone 8
– Log into Skype / Xbox

– Log into Office 365 hosted Exchange mailbox
– Log into Office 365 Sharepoint / Lync

Office subscription

Office 365 Home Premium

Office 365 ProPlus

Online files


Skydrive Pro

Perfectly clear! What could go wrong?

There’s one truly unfortunate crossover: as a consumer, you purchase a subscription to Office 365 Home Premium with a Microsoft account. For $99, you can install Microsoft Office on up to five devices, a great deal with only one side effect: the term “Office 365” becomes hopelessly muddled for you, because virtually nothing else about Office 365 applies to those consumer accounts.

That’s how you get instructions like this:

Skype - Link to Microsoft Office 365 account

“How do I link my Microsoft Office 365 account with my Skype account?

“1. Sign into Office 365 with your Microsoft account.”

Yeah, I guess that’s technically accurate for some consumers, but it’s doomed to failure for all the business people who sign into Office 365 with their Office 365 accounts and can’t link the accounts to Skype. It’s confusing and frustrating.

If you have both a Microsoft account and an Office 365 account, they will sometimes cause conflicts because Microsoft is not handling them well behind the scenes. Open up your Office 365 business webmail, then try to go check your personal webmail. You’ll get an error message:

Office 365 - error message

It’s not nice. People are forced to use InPrivate mode to check one or the other, so the accounts don’t fight with each other.

You can see IT pros complaining about the confusing setup here, among other places.

Very little is simple in 2013. Microsoft is moving faster than I would have predicted to clean things up from an even more complex muddle only a few years ago, so this is not awful, just something to know. And don’t make the mistake of thinking it’s better in Apple’s or Google’s ecosystems – they have their own issues.

If you can follow that, then you’ll be able to keep up when I try to distinguish Skydrive and Skydrive Pro in the next article!

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