Microsoft 365 Business Premium or E3: which fits your business
Published:
Short answer: for a business with up to 300 users, Microsoft 365 Business Premium usually gives more device protection than Microsoft 365 E3 and costs less. Microsoft 365 E3 is needed when the organisation has more than 300 users or wants Windows Enterprise and advanced management and compliance tools.
Last checked: 27 October 2026.
What is the difference between Business Premium and Microsoft 365 E3?
The biggest difference between Business Premium and Microsoft 365 E3 is the user limit and the kind of device protection. Business Premium has a 300-user limit and includes Microsoft Defender for Business with EDR. Microsoft 365 E3 has no user limit and includes Microsoft Defender for Endpoint Plan 1, which according to Microsoft has neither EDR nor automated investigation.
| Capability | Business Premium | Microsoft 365 E3 |
|---|---|---|
| User limit | 300 | No limit |
| List price (USD, with Teams, from 1/7/2026) | $22 per user/month | $39 per user/month |
| Windows | Upgrade to Windows 11 Pro | Windows 11 Enterprise E3 |
| Device protection | Defender for Business (with EDR) | Defender for Endpoint Plan 1 (no EDR) |
| Email protection | Defender for Office 365 Plan 1 | Defender for Office 365 Plan 1 |
| Device management | Intune Plan 1 | Intune Plan 1, and from 2026 Intune Plan 2, Remote Help, Advanced Analytics |
| Identity | Microsoft Entra ID P1 | Microsoft Entra ID P1 |
| Mailbox and archive | 100 GB and up to 1.5 TB | 100 GB and up to 1.5 TB |
| Office apps | 5 PCs or Macs, 5 tablets, 5 phones | 5 PCs or Macs, 5 tablets, 5 phones |
Sources: Microsoft Business and Enterprise plan comparison pages, 2026 pricing announcement, Microsoft Learn on Defender for Business.
Is Microsoft 365 E3 more secure than Business Premium?
Not necessarily: in computer protection, Business Premium is more complete than Microsoft 365 E3. Business Premium's Microsoft Defender for Business includes, according to Microsoft, the capabilities of Defender for Endpoint Plan 1 plus EDR and automated investigation. For a Microsoft 365 E3 user to have EDR, an extra licence is needed, for example Defender for Endpoint Plan 2 or Microsoft 365 E5.
Microsoft 365 E3 is stronger in other areas: Windows Enterprise, more advanced device management with the 2026 Intune additions, and no cap on the number of users.
When is Microsoft 365 E3 needed?
Microsoft 365 E3 is needed mainly when the organisation exceeds 300 users, because Microsoft allows up to 300 Business licences in total. Our own practical advice on when to choose:
- Choose Business Premium if you have up to 300 users and want the best device and email protection at the lowest price.
- Choose Microsoft 365 E3 if you have more than 300 users, or plan to exceed that soon.
- Choose Microsoft 365 E3 if you need Windows Enterprise for specific features or IT department requirements.
- Choose Microsoft 365 E5 if you want Defender for Endpoint Plan 2, Entra ID P2 and advanced compliance in the same plan.
What changed in Microsoft 365 E3 in 2026?
From 1 July 2026 the list price of Microsoft 365 E3 rose from 36 to 39 dollars per user per month (+8%), while Business Premium stayed at 22 dollars. At the same time Microsoft added Defender for Office 365 Plan 1, Intune Plan 2, Intune Remote Help and Intune Advanced Analytics to Microsoft 365 E3.
Can Business Premium and E3 coexist?
Yes, an organisation can have Business Premium and Microsoft 365 E3 licences in the same tenant, with Business licences staying at 300 in total. In practice this makes management more complex, so one main plan for everyone usually pays off (our own practical advice).
How ITHACA helps
ITHACA, a Microsoft partner in Athens, compares what you pay today with what you really need and configures Defender, Intune and access rules so that the licence protects in practice.
Frequently asked questions
Business Premium vs E3: which is cheaper?
Microsoft 365 Business Premium is cheaper. From 1 July 2026 Microsoft's list price is 22 dollars per user per month for Business Premium and 39 dollars for Microsoft 365 E3, on an annual commitment with Teams. Euro prices vary by country.
Does Microsoft 365 E3 include EDR?
No. Microsoft 365 E3 includes Microsoft Defender for Endpoint Plan 1, which according to Microsoft has neither endpoint detection and response (EDR) nor automated investigation. EDR is in Business Premium through Defender for Business, and in Microsoft 365 E5 through Defender for Endpoint Plan 2.
How many users does Business Premium allow?
Microsoft 365 Business Premium and all Business plans allow up to 300 licences in total per organisation. If a company has 250 Business Premium licences, it can add only 50 more Business licences. Above 300 users an Enterprise plan such as Microsoft 365 E3 is needed.
Do I need Windows Enterprise?
Most small and medium businesses are covered by Windows 11 Pro, which Business Premium provides as an upgrade. Windows 11 Enterprise, included in Microsoft 365 E3, is mainly needed in organisations with specialised management or security requirements from the IT department.
Can I move from Business Premium to E3?
Yes. Moving from Business Premium to Microsoft 365 E3 happens in the same tenant, without moving email or files, usually at subscription renewal. Before switching, check how EDR will be covered, because Microsoft 365 E3 does not include it.