Choosing an Office 365 license is a critical step before migrating to the cloud. With multiple options for small, medium and enterprise businesses, navigating the differences can get overwhelming. This Office 365 license comparison will reveal the options available within Business and Enterprise options available to help you make the correct choice for your organization.

Price Comparison for Office 365 Business Plans and Enterprise Licenses

When comparing Office 365 licenses, price is one of the first questions decision-makers ask. Here are the prices of each Office 365 Business and Enterprise license:

1 Year Agreement ($/user/month) 1 Month Agreement ($/user/month)
Office 365 Business Essentials $5.00 $6.00
Office 365 Business Plan $8.25 $10.00
Office 365 Business Premium $12.50 $15.00
Office Enterprise E1 $8.00 Annual Commitment Only
Office Enterprise E3 $20.00 Annual Commitment Only
Office Enterprise E5 $35.00 Annual Commitment Only
Office Enterprise Pro Plus $12.00 Annual Commitment Only

The base price per user for Office 365 Business and Enterprise Plans ranges from $5 to $30, and this cost can quickly add up for larger organizations. On the other hand, if you rely on certain functionalities like Rights Management or cloud PBX, bundling these services into your license can actually save your organization money.

To better weigh the costs to your organization, let’s compare the features of the Office 365 Business and Enterprise plans.

How Office 365 Enterprise and Business Plans Differ

Both the Office 365 Business plans and Enterprise plans are available for organizations with fewer than 300 employees.

Because larger companies are more likely to be using Office 365, you might be contemplating whether to go with a Business or Enterprise option.

Here are some major features you gain with Office 365 Enterprise plans:

  • Skype for Business Cloud (now Microsoft Teams) PBX and PSTN conferencing (PSTN calling is available as an add-on in E3 and E5)
  • Advanced Information Protection
  • Advanced Threat Protection
  • Active Directory integration
  • Power BI
  • Delve Analytics
  • Litigation Hold
  • Unlimited archive and mail storage
  • Enterprise app management

Enterprise plans are only available when purchased as a one-year commitment. However, Business plans are available month to month (for a slightly higher per-user price) and in yearly subscriptions.

Here’s a breakdown of all Office 365 Business plans so you can better understand how they differ.

Office 365 Business Plans

Office 365 Business plans were created for small businesses with fewer than 300 employees that might not need all the bells and whistles Office 365 offers.

Here’s what’s included in each Office 365 Business plan for small companies.

Office 365 Business Essentials

Looking to get basic Office 365 functionality? Office 365 Business Essentials offers business email with 50 GB mailbox storage, custom email domain and web versions of essential Office 365 applications like Outlook, Word, Excel and PowerPoint.

Here’s what you need to know about the Business Essentials license:

The Basics
Price $5/user/month (1-year agreement) or $6/user/month (1-month agreement
Who It’s For Companies with fewer than 300 users that don’t rely heavily on Office 365 applications, online storage or need desktop applications
What You’ll Get
Email with 50 GB mailbox
Custom email domain addresses
Web versions of Office 2016 applications: Outlook, Word, Excel, PowerPoint
1 TB of OneDrive storage
SharePoint (company-wide intranet and team sites to connect people to content, expertise and processes.)
Skype for Business: Unlimited HD video conferencing for up to 250 people.
Microsoft Teams chat-based workspace
Microsoft Planner to manage tasks and teamwork
Yammer to collaborate across departments and locations
FastTrack deployment support (when purchasing 50+ seats)
24/7 phone and web support

Office 365 Business

Next is the Office 365 Business plan. Here are the price and specs for this license option:

The Basics
Price $8.25/user/month (1-year agreement) or $10/user/month (1-month agreement)
Who It’s For Businesses with fewer than 300 users that only need Office applications, cloud file storage and sharing (email hosting not included)
What You’ll Get
Desktop versions of Office 2016 applications: Outlook, Word, Excel, PowerPoint and OneNote
Office Online: Web versions of the Office 2016 applications Outlook, Word, Excel and PowerPoint
OneDrive and 1 TB of OneDrive storage
FastTrack deployment support (for purchases of 50+ seats)
24/7 phone and web support

Office 365 Business Premium

The most expensive Business plan is Office 365 Business Premium. This license costs more than the Enterprise E1 option, so comparing the features is essential to choosing the right option.

The Basics
Price $12.50/user/month (1-year agreement) or $15/user/month (1-month agreement)
Who It’s For Businesses with fewer than 300 users that need the latest desktop versions of Office applications, cloud services and email hosting.
What You’ll Get
Email with 50 GB mailbox
Custom email domain addresses
Desktop versions of Office 2016 applications: Outlook, Word, Excel, PowerPoint, and OneNote
Web versions of Office 2016 applications: Outlook, Word, Excel, and PowerPoint
1 TB of OneDrive storage
SharePoint (company-wide intranet and team sites to connect people to content, expertise and processes)
Skype for Business: Unlimited HD video conferencing for up to 250 people
Microsoft Teams chat-based workspace
Microsoft Bookings to enable customers to schedule appointments
Microsoft Planner to manage tasks and teamwork
Yammer to collaborate across departments and locations
FastTrack deployment support (with purchase of 50+ seats)
24/7 phone and web support

Next, we take a look at the Office 365 Enterprise plans. As mentioned above, these are only available on a one-year commitment basis.

Office 365 Enterprise Plans

Office 365 Business plans are great for companies just starting out or that only require limited functionality. For organizations with 300+ users or those looking for a more robust solution, Office 365 Enterprise plans are available. With Enterprise plans, you can choose from Office 365 E5, E3 or E1 licenses.

Office 365 Enterprise E1

E1 is the cheapest Enterprise plan (and actually costs less than the Business Premium license). Here’s what you get with the E1 license:

The Basics
Price $8/user/month (annual commitment)
Who It’s For Users that don’t need desktop versions of Outlook or Office applications but still require eDiscovery and data governance.
What You’ll Get
Email 50 GB mailbox (only accessible from Outlook online)
Skype for Business web conferencing, IM, online meetings and presence
OneDrive for Business
Yammer
SharePoint
Video Sharing
Web versions of Office 2016 applications: Outlook, Word, Excel, and PowerPoint
File sharing and 1 TB OneDrive storage
HD video conferencing
Team sites
eDiscovery search
Data Governance manual classifications and manual policies for retention and deletion

Here’s how Office 365 Enterprise E1 differs from Business Premium:

  • With E1, you can only access email via the online application.
  • With E1, you lose desktop versions of Office applications. You must use the online versions of Outlook and other Office applications like Word or PowerPoint online.

Office 365 Enterprise E3

The E3 license is one of the more popular options for digital-driven businesses. You gain email, archiving, information protection and more storage options for only $5-$7.50 more per user per month than Business Premium.

Here’s what’s included in E3:

The Basics
Price $20/user/month (annual commitment)
Who It’s For Businesses that need more advanced BI, compliance, email, security and voice capabilities.
What You’ll Get
Everything included in the Office E1 License
Office Client Apps
Legal compliance and archiving needs for email: archiving, eDiscovery hold and export, mailbox hold
Information protection: message encryptions, rights management, data loss prevention
Azure Rights Management and document management functions: archiving, rights management, data loss prevention and document-level encryption.
Email storage for in-place archive
Unlimited OneDrive storage
eDiscovery legal hold
eDiscovery export and case management
Hosted voicemail support

The Office 365 Business Premium plan is most comparable to the Enterprise E3 plan in terms of base features.

Unlike Business Premium, E3 includes: 

  • Exchange Online Archiving (EOA) and Legal Hold
  • Unified eDiscovery Center
  • Rights management, data loss prevention and encryption
  • Ability to add on PSTN

Office 365 Enterprise E5

Building off the E1 and E3 business plans, Office 365 E5 is the highest tier Microsoft offers. With this license, you gain: 

The Basics
Price $35/user/month (annual commitment)
Who It’s For If you use or plan to use Skype for Business Cloud PBX, we recommend the Office 365 E5 license. For $35/user/month, you gain a complete, consolidated phone system along with all functionality available within Office 365.
What You’ll Get
Everything included in E3 and E5 licenses
Enhanced security features: Advanced discovery, secure attachments and URLs and access controls
Microsoft’s Business Intelligence tools for end user organizational analytics
Enterprise voice with Skype for Business (on-premises only)
Skype for Business Cloud PBX
Unlimited OneDrive storage
PSTN conferencing to dial in to Skype meetings from anywhere
Cloud-based call management
Advanced analytics with Power BI Pro and Microsoft MyAnalytics
Advanced eDiscovery
Advanced Data Governance
Advanced security with Advanced Threat Protection and Customer Lockbox
Enhanced visibility and control of your Office 365 environment

Next, we look at Office 365 Enterprise ProPlus. It is the last Enterprise plan offering.

Office 365 Enterprise ProPlus:

Office 365 Enterprise ProPlus offers a unique option for users who don’t need email access but require more advanced functionality than the Office 365 Business plan offers.

The Basics
Price $12/user/month (annual commitment)
Who It’s For Users that rely heavily on Office 365 applications on mobile devices, do not need email access but require compliance and basic business intelligence.
What You’ll Get
File sharing and 1 TB OneDrive online document storage
Fully installed Office on PC/Mac
Office apps on tablets and phones
Self-service BI in Excel
Office Online: Create, view and edit rights for online versions of core Office apps for collaborating on documents
Sway for Office 365
eDiscovery search
On-premises Active Directory sync for single sign-on
Mobile device management

If any license doesn’t suit your needs, you can also add on specific features like Skype Cloud PBX. But often, the cost of upgrading is cheaper than ballooning a license with monthly add-on charges. (Read more about add-ons here.) You can also mix and match licenses depending on user needs to better control costs.

ITWorkX cloud licensing services make it easy to purchase, transfer and manage your licenses. As your cloud solutions provider, ITWorkX handles all billing and subscriptions for your Office 365 products. You continue paying Microsoft the monthly license fee, and we take care of the rest.