I was very reserved against the subscription model of M$ Office365 at first, but have to admit the annual fee is less than I paid before keeping up to date with the purchase model (some is due to the inclusion of Skype calls into the subscription though).
A word to the open source solutions - only go that way if and only if you never will be forced to archive anything electronically, you cannot make sure the files are readable after a certain time. If you have that need, you have to have a separate virtual machine setup to archive an environment in which the files are readable as well.