Consumers are not the target audience. Ever visited Windows 365 landing page? There are two buttons. Windows 365 Business and Windows 365 Enterprise. Pricing may seem weird to some consumers, but it often makes sense for businesses for the following reasons.
1) Businesses are much richer than individuals: $20-158/mo may seem steep to working class people, but that's basically nothing for UHNWIs. A person with $30m net worth could be considered as rich in almost any country, and they perceive price tags differently, compare to middle class people. However, a company with $30m net asset is still a small time business.
2) Tax deductions: Most individuals don't get any tax deductions when they purchased a new PC, but most businesses do. They could also get the similar deduction, when they purchase it outright, but this deduction coming from asset depreciation works differently than the deduction coming from cloud service fee. Between those two, the latter is preferrable. You have other ways to get the latter type of deduction (such as lease), but those methods also incur additional charge.
3) Maintenance cost: If you only have a few PCs, maintenance is not much of an hassle. However, if you have a several dozens of PCs (which is a rare occasion for individuals), you probably know about the extreme hassle of multi-PC maintenance. Guess what? Businesses often have several hundreds to several hundred thousands of PCs. Those PCs are not maintained automatically, nor by the employees. Well, some employees may be able to do that, but majority of employees (even if the company is relatively tech-savvy) often encounter issues that they couldn't handle it for themselves. You gotta take care of them, and you have roughly two other options;
- In-house: You hire people to handle those maintenance. But a single maintenance guy simply cannot handle 100k computers. You have to hire one for several hundred PCs. If you pay them $50k/y, your actual spending is more like $90k/y. That works out $180/PC/year if that person handle 500 PCs. You don't want them to handle too many PCs, because handling many PC = longer downtime = greater loss of wage (because you also pay the guy in front of the broken computer).
- On-site service packages: You can just pay Dell, Lenovo, or whatever to get on-site service packages (some offers next business day service, while some do 4 hour services). However, you gotta pay at least several hundred bucks for each PC, on top of the price tag which is alreday enterprise-taxed.
See? Both options are not exactly cheap. Cloud services cannot completely eliminate maintenance duty, but you could certainly downscale your maintenance team. If you downsize 5 to 1, you save $360k/y, enough for 1800 PCs at $200/y.
4) Similarly, the cost of backups, security, etc: If your employees do some stupid things and wreck the data they've worked on for a good amount of time, that's your wage down the drain. In order to mitigate this risk, you gotta deploy some sort of backup mechanisms for each PC. It could be based on centralized server or additional storage on each PCs, but either one of those option cost you money, and some workforce (from those maintenance guys). Most cloud services have easily deployable backup systems, so your data is relatively more resilient under the minimal maintenance effort. Likewise, you could control the flow of data more easily on centralized servers, rather than individual PCs. If you want to control the flow of data on individual PCs, then you need to have installed some specialized software for that (which don't usually come cheap) to each PCs, and you also gotta monitor ins and outs of any storage device.
5) Scalable: Most office works don't require big processing power, but when you happened to have one of those power hungry tasks from time to time, you could temporarily scale up your processing power for the job on cloud services. But that's not possible when you purchased PCs and servers. You either have to spend a lot of money on rarely used hardwares just for those rare power-hungry events, or pay for other cloud services from time to time.
