Microsoft 365 Business Premium vs E3: Security, Features, Costs

Startups and enterprises must know the key Microsoft 365 Business Premium vs E3 differences. Your company is at a fork in the road. If you’re teetering on the cusp of massive growth, E3 is the ideal option for scaling.

But Business Premium offers the security and power perfect for companies with 300 or fewer users.

We’ll explain these differences for you below so that you can select the right choice for you.

Why This Comparison Matters Today

Microsoft 365 Business Premium vs E3 dictates how your company will grow in the coming years. You might need a basic package with:

• Up to 300 users
• 1 TB of storage per user
• 10 additional apps
• Basic data loss prevention

But if you expect to need more than 300 users or require advanced DLP policies and comprehensive compliance, then your choice matters.

You’re deciding between more than just price; this choice is about future growth and scale.

What Microsoft 365 Business Premium Includes

You have plenty of options if you’re not yet an enterprise. A Microsoft 365 Business Premium vs E3 comparison comes down to more than just money. But, you’ll pay $22 a month, paid yearly per user for this tier, which includes:

• Identity and access management
• 300 maximum users
• Custom business email
• 1 TB of storage per user
• 10+ additional apps
• Cyberthreat protection
• Any time protection and support

Users receive access to all of the major tools they need to be productive: Word, Excel, Outlook, PowerPoint and many others.

Basic data loss prevention and multi-factor authentication are also available.

What Microsoft 365 E3 Brings to the Table

You’ll need to make an annual commitment when choosing this product. Microsoft 365 Business Premium vs E3 pricing is $22 vs $36, so the cost is over 50% higher for this version. But you also have:

• Unlimited users
• Up to 5 TB storage per user
• Antivirus and antimalware tools
• Unified endpoint protection
• Shadow IT discovery
• Advanced DLP policies
• Robust MDM
• Stricter regulation and compliance

Key Differences Between Business Premium and E3

You’ll find plenty of features and limitations with each offer. Microsoft 365 Business Premium vs E3 differences are:

Feature	Microsoft 365 Business Premium	Microsoft 365 E3
User Limit	Maximum 300 users	Unlimited users
Windows OS	Windows Pro license required (not included)	Windows 11/10 Enterprise (included)
Core Endpoint Security	Microsoft Defender for Business (Built-in, high-value EDR for SMB)	Microsoft Defender Antivirus (Foundational) – EDR requires an add-on
Exchange Mailbox	50 GB	100 GB with Unlimited Archive
Advanced Compliance	Basic DLP, Message Encryption, and Sensitivity Labels	Advanced Purview features like eDiscovery (Standard), more granular DLP, and legal hold

Licensing Limits and User Requirements

Microsoft 365 E3 vs Business Premium, for a lot of companies, comes down to:

• 300 users on Business; Unlimited on E3
• Same constraints on licensing

If you require more than 300 users or licenses, your only option is to move up to E3 or higher.

Advanced Security and Compliance Features

E3 is designed to offer greater control and security. Some of the more notable differences are:

• Business comes with Defender and EDR; E3 requires an add-on
• Entra ID P1 is available for multi-factor authentication on both tiers
• E3 has greater classification and labeling automation
• DLP is available on both tiers, but Enterprise is more robust

Device and Endpoint Management Differences

Both E3 and Business Premium include Microsoft Intune Plan 1. This is a comprehensive solution for device and application management.

One advantage E3 has is that it includes a Windows Enterprise license, which enables advanced features like Windows Autopilot.

Security Comparison: Business Premium vs E3

No comparison of Microsoft 365 Business Premium vs E3 is complete without a look at security features.

Here’s how the two measure up in this category.

Threat Protection Tools

Options are more limited with Microsoft 365 E3 vs Business Premium for threat protection tools. It includes:

• Defender for O365 P1, which offers phishing and attachment protection
• Defender for Business, which has threat analytics and endpoint protection

E3 only offers standard protection and a basic antivirus.

Data Loss Prevention & Compliance Policies

One of the biggest Microsoft 365 E3 vs Business Premium differences is in data loss prevention and compliance.

E3 is the stronger choice here for large enterprises in regulated industries. It includes eDiscovery and advanced DLP. You also get more granular control over retention policies to meet compliance standards like GDPR or HIPAA.

Business Premium has basic tools like:

• Sensitivity labels
• Basic DLP
• Message encryption

Identity Protection Capabilities

There are a few Microsoft 365 E3 vs Business Premium differences when it comes to identity protection.

Both plans include Microsoft Entra ID P1, which provides:

• Multi-Factor Authentication
• Conditional access policies
• Self-service password reset

Pricing Breakdown: Which Option Costs Less Long-Term?

Costs are generally higher for Microsoft 365 E3 vs Business Premium.

• Monthly fees are around $36 per user, per month, with an annual commitment for E3. Long-term costs are even higher because you need to purchase add-ons to get the same level of security features that Business Premium offers.
• Business Premium is about $22 per user, per month (annually) and includes high-level security tools without additional fees.

That said, if you have more than 300 users, E3 is your only option. Otherwise, Business Premium offers the lowest cost over the long term.

Which Plan Fits Your Business Needs Better?

The right plan for your organization depends on:

• User numbers
• Needs
• Growth goals

A small business has different needs than an enterprise.

While every organization is unique, generally:

• Business Premium is best for small to medium businesses. It offers enterprise-level security and easy management for up to 300 users.
• M365 E is ideal for growing businesses. There’s no user limit and scalability is seamless.
• Highly regulated industries should use M365E. It offers more mature and auditable advanced compliance features through the Purview suite.
• Enterprises should use M365 E. It supports complex hybrid setups, offers modular security additions and includes Windows Enterprise licensing.

Migration Considerations Before Switching Plans

A Microsoft 365 Business Premium vs E3 comparison helps you understand whether you should migrate to a different plan.

Here are some things to consider before you make any moves.

• Are you growing? Upgrade from Business Premium to E3 if you exceed 300 users. You’ll need to purchase security add-ons like Defender for Endpoint P2 to keep the same level of threat protection that Business Premium offers.
• Are you downsizing or cutting costs? Switch from E3 to Business Premium if you have under 300 users. One benefit of this move is that you’ll get access to higher-value security features that E3 doesn’t offer.
• Consider archive data. E3 has an unlimited archive mailbox – something Business Premium doesn’t offer. What will you do with your archive data if you migrate from E3?

Summary: Business Premium vs E3 — Who Wins?

The winner of Microsoft 365 E3 vs Business Premium depends on the organization’s size and regulatory needs.

• Business Premium wins for SMBs with fewer than 300 users. It offers a stronger security posture (Defender for O365 P1, Business EDR) at a much lower cost than an E3 subscription.
• E3 wins for enterprises and scalability. It provides unlimited users, comprehensive cloud storage, a Windows Enterprise license and granular compliance tools that large, regulated organizations need.