Advice on Server 2012 Essentials & Office 365 please

Hello All
I have a new customer who is wanting to upgrade his systems, both hardware and software.
There are 2 users and 2 elderly PCs with Windows XP and a couple of printers.
No backups have ever been done!
I suggested, first and foremost, a couple of new PCs running Windows 7 Professional 64 bit and a recent version of Microsoft Office on each.
They also want to go down the server route, so I suggested a small server with mirrored disks, running something like Windows 2012 Essentials (the chance of them ever going above 25 users is very remote).  That would centralise the files and make backup easier, plus, I believe backup images of both of the PCs connected?  It would also allow them to connect in remotely to the network from home.
They like the sound of Office 365, as they have PC's at home, and also smartphones.  They like the idea that they can install the software on up to 5 devices each.
My questions are;
1) does everything above make sense?
2) How would the above arrangement work?  My understanding of Office 365 is that the user has a "cloud" drive, and a local copy of the files they are working on.  When they have an internet connection, the files are synced.  Going down the server route, there would be a shared folder on the server which the users would access to get their files.  Would that shared folder then be synced with the cloud?  Would I still need to buy Office 365 for both the users, or do I then only need 1 copy?
Who is Participating?
James HodgeConnect With a Mentor Managing DirectorCommented:
Hello and welcome to the world of Office 365!

Office 365 Home Premium can be installed on up to 5 devices per user.

Your plan makes sense.

You might find if all you really want is backup and file storage then you don't need to go out and buy Server hardware or software. A PC with redundant disks and a Windows 7 install plus a few USB Disks for backup management would suffice.

Your understanding is about right. The client side tool is SkyDrive (Pro) that synchronizes files locally from the Office 365 SharePoint site.

You can learn a little bit more here:

If you have any more questions, please feel free to ask.

David Johnson, CD, MVPOwnerCommented:
1 copy can be used on up to 5 devices. Offfice 365 for home and business.
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