Microsoft 365 E3 vs E5: what you pay extra for, and when it is worth it

The gap between E3 and E5 is €20.35 per user per month excluding VAT, whether or not you take Teams. On Microsoft France's pricing page checked on 26 October 2026 (annual commitment and payment), Microsoft 365 E3 costs €37.78 and E5 €58.13. The EEA versions without Teams cost €30.36 and €50.71, and Microsoft Teams EEA sells on its own for €7.41. Add it up: the no-Teams version plus Teams EEA comes to the same price, give or take one cent. Going without Teams therefore only saves money if you use another video-conferencing tool.

Sold only without Teams to new European customers from 1 October 2023, the suites with Teams have been offered to everyone again since 1 November 2025, according to Microsoft. Do not confuse them with Office 365 E3 and E5, which are lighter because they lack Enterprise Mobility + Security: that is why Microsoft requires Office 365 E3 plus EMS E3 as a prerequisite for its security suites. Above them, Microsoft 365 E7 is listed at €91.92: it includes E5 and adds Copilot, the Microsoft Entra Suite and Agent 365.

On security, E5 turns basic protection into detection and response capability. Microsoft France's comparison puts E3 on Defender for Endpoint Plan 1 and E5 on Plan 2. The difference is clear: according to Microsoft Learn, Plan 1 includes neither endpoint detection and response (EDR) nor automated investigation and remediation, both of which Plan 2 provides.

On email, the gap has narrowed. Since the packaging update Microsoft announced in December 2025 and rolled out from June 2026, E3 includes Defender for Office 365 Plan 1: Safe Links, Safe Attachments and impersonation protection. E5 keeps Plan 2, which adds attack simulation training, Threat Explorer and automated investigation.

E5 then adds three components that E3 lacks. Defender for Identity monitors identities, including an on-premises Active Directory. Defender for Cloud Apps protects SaaS applications, whereas E3 only has its Shadow IT discovery feature. Microsoft Entra ID P2 replaces P1: it brings risk-based Conditional Access, which blocks a sign-in judged suspicious, and Privileged Identity Management (PIM), which makes administrator rights temporary and traceable.

The last addition is Security Copilot. Microsoft states on its pricing page that it is included for eligible E5 customers, with 400 Security Compute Units (SCUs) per month for every 1,000 licences, capped at 10,000 SCUs. Opened on 18 November 2025 to E5 customers already using it, it is being extended to the others in stages, with advance notice.

The other part of the gap pays for compliance, telephony and data analysis. For Microsoft Purview, E3 has Audit Standard and eDiscovery Standard, while E5 moves to Premium. According to Microsoft Learn, Audit Standard keeps logs for 180 days, Audit Premium for one year for Entra ID, Exchange, OneDrive and SharePoint, and up to ten years with an add-on licence. E5 also adds insider risk management, which can spot a data leak before someone leaves, communication compliance, and data loss prevention extended beyond email and files.

On telephony, Microsoft's comparison shows Teams Phone and Audio Conferencing included in the E5 version with Teams. With E3, Teams Phone Standard costs €8.70, and only a free Audio Conferencing licence limited to outbound calls to the United States and Canada is available. In both cases you still need a Calling Plan or an operator to reach the public telephone network.

Finally, Power BI Pro, sold at €12.10, is included in E5. Run the numbers for a user who needs both: Teams Phone Standard plus Power BI Pro cost €20.80 per month, more than the €20.35 separating E3 from E5. For that profile, E5 costs less than a topped-up E3, with advanced security as a bonus. Since summer 2026, E5 also includes three Intune features absent from E3: Endpoint Privilege Management, Cloud PKI and Enterprise Application Management.

If only one of the two blocks interests you, Microsoft sells each one separately to E3 customers. The Microsoft Defender Suite, formerly Microsoft 365 E5 Security, and the Microsoft Purview Suite, formerly E5 Compliance, are each listed at €10.40 per user per month excluding VAT on microsoft.com/fr-fr, with Microsoft 365 E3 as a prerequisite. The first brings together Defender for Endpoint Plan 2, Defender for Identity, Defender for Office 365 Plan 2, Defender for Cloud Apps and Defender for IoT, and Microsoft Learn adds Entra ID P2. The second covers advanced information protection and data loss prevention, insider risk, advanced Audit and eDiscovery Premium.

The rule is simple. One suite on top of E3 comes to €48.18 per user, about €10 less than E5. Both suites together cost €20.80, more than the gap to E5, without Teams Phone, without Power BI Pro and without the Security Copilot allocation Microsoft reserves for E5 and E7 customers. If you need both blocks, take E5.

Below 300 users, Business Premium protects devices better than E3 for roughly half the price. It costs €19.06 excluding VAT (€16.28 without Teams), against €37.78 for E3, and Microsoft limits it to 300 users. It includes Defender for Business which, according to Microsoft Learn, provides EDR and automated investigation, both missing from the Defender for Endpoint Plan 1 supplied with E3. Both offers share Entra ID P1, and therefore Conditional Access, as well as Defender for Office 365 Plan 1.

Below that threshold, E3 is justified in three cases: a need for Windows 11 Enterprise (Business Premium provides an upgrade to Windows 11 Pro), OneDrive storage beyond 1 TB per user, or growth that will take you past 300 accounts in the short term. Otherwise, an SME moving from Business Premium to E3 pays more for weaker device protection. We cover this choice in our comparison Business Premium or Business Standard.

The right decision is made profile by profile, after taking stock of what you already pay for elsewhere. First list your third-party tools: EDR, email gateway, archiving, privileged account management, BI, phone system. Every line covered by E5 becomes a possible saving when the contract ends. If you keep them, E5 duplicates them.

Then look at your written requirements. The NIS 2 directive (EU 2022/2555) requires in Article 21 "appropriate and proportionate" measures, including incident handling, access control and multi-factor authentication. It names no product, and multi-factor authentication already exists in E3. Have your reading checked by your lawyer or DPO, and see our article on NIS 2. Also reread your cyber insurer's questionnaire: if it requires EDR or privileged account management, Defender for Endpoint Plan 2 and PIM answer a written requirement.

Finally, mix your licences. Take a mid-sized company with 500 users: moving everyone to E5 costs €20.35 × 500 × 12, or €122,100 more per year excluding VAT. Reserving E5 for 80 exposed profiles (management, finance, legal, IT administrators) brings the extra cost down to €19,536. A word of caution: Microsoft states that some services cannot limit their benefits to specific users, and the appropriate licences remain required for each use. Validate the split service by service.

Sign neither E5 for everyone nor E3 by reflex: cost three scenarios on your real figures. E3 alone with the third-party tools you keep, E3 plus a Defender or Purview suite if a single block is enough, and a mixed estate: E5 for exposed profiles or those who combine Teams Phone and Power BI Pro, E3 for everyone else.

If you are already on E5, start by switching on what you pay for: PIM and risk-based Conditional Access policies require configuration and protect nothing before then. Our article on unused Microsoft 365 licences shows how to spot what lies dormant. To measure before buying, Microsoft also offers a 90-day trial of Defender for Office 365 Plan 2.

Helion Cloud, a CSP reseller and Microsoft Solutions Partner for Security, carries out this costing for mid-sized companies as well as SMEs: our certified consultants start from your usage reports and third-party contracts, then switch on what is already paid for (see our security page).