In an e-mail to staff and students the university said, “This decision has been reached after an extensive analysis over the past few months that compared Google Apps for Education and Microsoft’s Office 365 offerings.” It even noted, “While both products are feature rich and offer advantages over our current environment, the analysis concluded that the Google offering was the better overall fit for the campus at this time.”
The decision interestingly had a number of queries, as there were doubts whether Google would be able to sustain the different security requirements of the city departments. The queries continue to be unresolved as according to a detailed report, the explanation noted reasons for Google Apps, being chosen over and above Office 365. But on the security and privacy issues, Microsoft’s offering was favored by UC Berkeley, even though the margin was quite small.
The report said, “Microsoft offers a better AUP policy, better e-Discovery options, and slightly better terms on the location of data.”
Security and privacy were not the only issues where Microsoft was given the upper edge, but the same giant was even preferred in case of Office 365’s calendaring. For Google Calender, the report noted that while Google Calendar might be an easy fit for light or average calendar users, “power users” — who are small in number but account for the majority of all calendar use — might be put off by the loss of some functionality. 
Considering the contractual issues, Microsoft was a clear winner as per the reports as it said, “Microsoft has a superior contract due to the following: HIPAA, Data Transfer, and Account Suspension. Limitation of Liability is the most salient area where Google is superior.”
Interestingly, this is not the first instance when Microsoft lost to Google in this section. Earlier, Microsoft had also submitted a bid to the city of Los Angeles, but lost to Google.
So, why was Google actually preferred?
Google earned reward points when the comparison was made for e-mail. Google not only earned a ‘+1’, but was considered a far far far better option.
In short, Google ranked higher in the categories of migration and deployment speed, support, user familiarity, API, administration and collaboration tools, while Office 365 nods for its on-premises integration and authentication capabilities.
Noting the conclusion of the report, the result and reasons were detailed, but to give things a formal meaning, the report concluded:
Office 365 offers an integrated experience for on-premise and cloud users. This comes at a greater ongoing, operational expense and complexity of maintaining central infrastructure. Office 365 is a very new service, even universities such as Nebraska that were first to sign-up are still not migrated. Microsoft’s previous online service offerings (BPOS, Live@EDU) did not have exceptional track records for performance.
… Functionally, Google has significant advantages that Berkeley can quickly and cost-effectively take advantage of; its most significant weakness is its lack of integration with an on-premise email and calendar solution in the way Office 365 does. Microsoft requires significant central AD and Exchange infrastructure.