So Microsoft's latest effort is to try and turn Office into a subscription model. But I think they have seriously miscalculated in terms of the price they're charging.
You can buy, for £89, a physical copy of Office 2010 Home for up to 3x users. They're trying to sell Office 365 for £79.99/year for up to 5x users.
Now you might say that the Skype credit and SkyDrive bits are worth a lot. They are worth something but some quick maths suggests the Skype stuff is worth approx £18/year at Skype's current rates.
The SkyDrive space is worth £6/year for the additional 20 GB. Keep in mind that you only get 20 GB once, not 20 GB each year, so you're paying to maintain that additional storage, not to buy more...
So: - Skype: 18 - SkyDrive: 6 - Therefore: You're paying £55.99/year just for Office.
I'd prefer to pay £89 for the physical boxed copy of Office 2010. I only buy Office once every eight years anyway, plus there is no assurance that Office 365 even gives you the newer versions of Office when they come out in the future (i.e. there might be an "upgrade fee").