Office 365 is a cloud-based version of Microsoft Office that includes business-class email, web conferencing, and file sharing. It includes no advertising, and all of your data is kept separate from consumer services. Your data belongs to you and you can remove it whenever you want to.
If your organization is considering moving productivity services to the cloud and has questions about protecting the safety of your data, we have answers about Office 365.
More information about privacy and security in Office 365
"No Advertising: Office 365 does not build advertising products out of customer data. We don’t scan your email or documents for building analytics, data mining, advertising, or improving the service."
Didn't they used to say the same things about paid hotmail/msn/live email accounts? They can change the TOS at any time.
The same can not be said for SkyDrive or Outlook.com, when you pay for the service, you get errors, and ads saying that "we are still working out bugs, your paid upgrade features will be available shortly". My advice, just pay for Office 360. It works, plenty of storage and you get a cloud e-mail without adds.