Microsoft Explained

Microsoft 365 Business Premium vs E3: which is right for you?

These two plans get confused constantly — and picking the wrong one means overpaying or missing out on security. Here’s the plain-English difference.

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Quick answer

Microsoft 365 Business Premium is the best-value plan for most small and mid-sized businesses (up to 300 users): it bundles the Office apps, email and Teams with advanced security — Microsoft Defender for Business, Intune device management and Entra ID P1. Microsoft 365 E3 is an enterprise plan with no user cap and extra compliance and management features, but its advanced security often costs extra on top. For most organisations under 300 users, Business Premium gives more security for less; E3 suits larger organisations or those with specific enterprise or compliance needs.

Side by side

The key differences

Business PremiumEnterprise E3
User limitUp to 300 usersNo limit
Office apps, email, TeamsYesYes
Advanced security includedYes — Defender for Business, Intune, Entra ID P1Core only; advanced security often costs extra
Enterprise compliance/managementLimitedMore extensive
Best forSMEs up to 300 users wanting security built inLarger orgs or specific enterprise/compliance needs
Cost per userLowerHigher

How to choose

A simple rule

If you have fewer than 300 users and want strong security built in without bolting on extras, Business Premium is almost always the right answer — it’s the SME sweet spot. Choose E3 if you’re over 300 users, or you need specific enterprise compliance, data-governance or management features. Many businesses on E3 are actually paying more for less security than Business Premium gives.

Licensing is fiddly and prices change, so it pays to get it right. We’re a Microsoft Cloud Solution Provider — see Microsoft 365 licensing, or we’ll review your current licences and make sure you’re on the right plan (and not overpaying). It also pays to harden whichever you choose with security baselines.

FAQs

Common questions

What’s the main difference between Business Premium and E3?
Business Premium is capped at 300 users but includes advanced security (Defender for Business, Intune, Entra ID P1). E3 has no user cap and more enterprise/compliance features, but advanced security usually costs extra.
Which is cheaper, Business Premium or E3?
Business Premium is typically cheaper per user and includes more security for most SMEs. E3 costs more per user and often needs paid security add-ons to match Business Premium’s protection.
Can I use Business Premium with more than 300 users?
No — Business Premium is capped at 300 users. Above that you’d move to an enterprise plan like E3 (or mix plans across your users).
Do I need E3 for better security?
Usually not. Business Premium already includes strong security for SMEs. E3’s advanced security features are often paid add-ons, so E3 isn’t automatically more secure.
How do I know which plan I’m on — or should be on?
We can review your current Microsoft licences as a Cloud Solution Provider and recommend the right plan, making sure you’re secure and not overpaying.

On the right Microsoft plan?

We’ll review your licences and make sure you’re secure and not overpaying. Talk to us about Microsoft 365.