Is Microsoft 365 E5 Worth It?

The short answer…Yes!  Microsoft 365 E5 is the “Cadillac” of licenses.  It provides the most capabilities and features within the Microsoft 365 ecosystem.  That also means it comes with the highest cost.  For a lot of organizations, cost is a top factor in determining which licenses to procure and looking past the cost is a challenge. 

With the most recent announcement of a pricing increase to Microsoft 365 licenses, it’s worth looking at what you are getting with these bundles of licenses.  Microsoft 365 E5 is one of the few bundles that is not increasing in price, staying at $57/user/month. 

Microsoft is becoming more and more like the cable company of the cloud with their bundled licenses.  You can obtain a lot of services for a single price.  However, to get the most value and return on investment (ROI), you need to understand what you are paying for, but also utilize those services, while not paying for duplicate services.  You wouldn’t pay for fully loaded Cadillac with GPS navigation just to buy a separate navigation system, would you? 

Microsoft 365 Licenses

Microsoft 365 is comprised of three bundles of licenses: Office 365, Enterprise Mobility + Security, and Windows 10 Enterprise.  Whether you have E3 or E5 determines which tier of each bundle you are getting.  There are also variants for EDU (A3/A5), Government (G3/G5), and Frontline (F3/F5) each with subtle differences, but mostly similar. 

Aaron Dinnage, a Microsoft employee, has created a fantastic resource to illustrate the many different licensing options within the Microsoft 365 ecosystem.  You can view this at 

If you are only going to utilize 1-2 features from each of the bundles, it may not make sense to uplift to E5.  However, if you have E3 and require 2 or more features from E5, typically the additional cost of 2 or more individual add-ons will bring you close to, if not more than, the cost of E5. 

Let’s look at what is included in both Microsoft 365 E3 and E5 bundles. 

Microsoft 365 E3 Features (34 total) 

Microsoft 365 E3 licenses are the most common licenses I see in customer tenants.  This is mainly because of the depth of productivity capabilities it provides within Office 365 is necessary for most organizations.  There is a sprinkle of common security and compliance features provided such as multi-factor authentication, device management, and encryption capabilities.  However, these alone will not be enough to provide an end-to-end Zero Trust environment and additional solutions will be required.  Here is currently what is provided with Microsoft 365 E3 licenses: 


  • Common Data Service 
  • Common Data Service for Teams 
  • Exchange Online (Plan 2) 
  • Insights by MyAnalytics 
  • Microsoft 365 Apps for Enterprise 
  • Microsoft Bookings 
  • Microsoft Forms (Plan E3) 
  • Microsoft Kaizala Pro 
  • Microsoft Planner 
  • Microsoft StaffHub 
  • Microsoft Stream for Office 365 E3 
  • Microsoft Teams 
  • Office for the Web 
  • Power Apps Basic for Office 365 
  • Power Automate Basic for Office 365 
  • Power Virtual Agents for Office 365 
  • Project for Office (Plan E3) 
  • SharePoint (Plan 2) 
  • Skype for Business Online (Plan 2) 
  • Sway 
  • To-Do (Plan 2) 
  • Universal Print 
  • Viva Learning Seeded 
  • Whiteboard (Plan 2) 
  • Windows 10/11 Enterprise (Original) 
  • Windows Update for Business Deployment Service 
  • Yammer Enterprise 


  • Azure Active Directory Premium P1 
  • Cloud App Security Discovery 
  • Microsoft Azure Multi-Factor Authentication 
  • Microsoft Intune 


  • Azure Information Protection Premium P1 
  • Azure Rights Management 
  • Information Protection for Office 365 – Standard 

Microsoft 365 E5 features (39 total) 

Microsoft 365 E5 licensing bundle includes everything previously mentioned with Microsoft 365 E3 as well as a plethora of additional security and compliance solutions, including the Microsoft 365 Defender Suite.  This bundle does include productivity features such as Phone System and other full feature solutions; however, most customers uplift to E5 for the Security and Compliance features.  Here is currently what is provided with Microsoft 365 E5 licenses: 


  • Graph Connectors Search with Index 
  • Microsoft 365 Audio Conferencing (soon to be included on E3) 
  • Microsoft 365 Phone System 
  • Microsoft Excel Advanced Analytics 
  • Microsoft Forms (Plan E5) 
  • Microsoft MyAnalytics (Full) 
  • Microsoft Stream for Office 365 E5 
  • Power Apps Basic for Office 365 (Plan 3) 
  • Power BI Pro 
  • Project for Office (Plan E5) 
  • To-Do (Plan 3) 
  • Whiteboard (Plan 3) 


  • Azure Active Directory Premium P2 
  • Azure Information Protection Premium P2 
  • Customer Lockbox 
  • Microsoft 365 Advanced Auditing 
  • Microsoft 365 Defender 
  • Microsoft Defender for Cloud Apps 
  • Microsoft Defender for Endpoint 
  • Microsoft Defender for Identity 
  • Microsoft Defender for Office 365 (Plan 2) 
  • Microsoft Endpoint DLP 
  • Office 365 Cloud App Security 
  • Office 365 Privileged Access Management 
  • Office 365 SafeDocs 
  • Premium Encryption in Office 365 


  • Data Classification in Microsoft 365 
  • Information Barriers 
  • Information Protection for Office 365 – Premium 
  • Microsoft 365 Communication Compliance 
  • Microsoft Communications Compliance 
  • Microsoft Communications DLP 
  • Microsoft Customer Key 
  • Microsoft Data Investigations 
  • Microsoft Information Governance 
  • Microsoft Insider Risk Management 
  • Microsoft ML-Based Classification 
  • Microsoft Records Management 
  • Office 365 Advanced eDiscovery

Additional Features Not Included In E5 

Microsoft 365 E5 is the highest tier of license you can procure, but unfortunately, that doesn’t mean you really do get everything.  As Microsoft continued to innovate and develop new features and solutions, most of the time new features and improvements are simply added into existing license bundles.  Occasionally, they determine these new solutions require an additional cost in addition to E5 licenses. 


There are several features that may be required in addition to E5 licenses to obtain the desired end state you are looking to achieve.  Here are some of the features and solutions that are not included in Microsoft 365 E5 licenses: 

  • Domestic and/or International Calling Plans (plans from $6 to $24/user/month) 
  • Communication Credits (per usage charges) 
  • Microsoft Teams Rooms Standard/Premium ($15/$50 per month per device) 
  • Microsoft Project (up to $55/user/month)  
  • Microsoft Visio (up to $15/user/month) 
  • Multi-Geo tenancy ($2/user/month) 
  • Privacy Management ($5/user/month) 
  • App Governance (Defender for Cloud Apps required, $4/user/month) 
  • Azure Purview (Pricing) 
  • Compliance Manager Premium Templates ($30k/year/assessment) 
  • Microsoft Sentinel (Pricing) 
  • Several free ingestion sources  
  • Microsoft 365 Defender Raw logs (500MB stipend per user free) 
  • Defender for Endpoint for Servers ($15/server/month) 

Return On Investment (ROI) Analysis

Microsoft provides an ROI Calculator as well as a Total Economic Impact analysis for Microsoft 365 E5.  These do provide great high-level insights on the potential of savings and benefits.  However, the Net Present Value (NPV) is always skewed in Microsoft’s favor.   

Let’s take a sample 1000 employee company.  Microsoft’s ROI calculator claims to provide $15.68 million NPV over three years.  The number could be correct, but you would have to be all in on every single Microsoft suggestion, from cost displacement, travel reduction, automation, etc. 

It is a great starting point to obtain some initial insights and guidance on the potential.  But most likely, you will require a custom ROI analysis geared specifically towards your environment.  You may have no desire to automate or have limited 3rd party solutions to provide cost displacement potential.  When looking at your own environment, there are generally three categories to evaluate against the cost of Microsoft 365 E5 licenses: Cost, Benefits, and Solution replacement. 


Calculate total costs of deploying Microsoft 365 security solutions including: 

  • License cost 
  • What will be the Agreement type (EA, CSP, Open, etc) and initial commitment length? 
  • Do all users require Microsoft 365 E5? 
  • Do non-FTE users (vendors, contractors, etc.) require Microsoft 365 E5 licenses? 
  • Capex to Opex expense 
  • Additional licenses not included in Microsoft 365 E5 

  • Timeframe 

  • Proof of Concept to help validate purchase 
  • Pilot to develop optimal production roll out 
  • Longer deployments may leave bulk of licenses unassigned
  • Deployment costs for planning, installing, architecting, designing, and implementing 

  • Consulting services 
  • Internal IT Staff 
  • Training and Change Management services 

  • End users 
  • Internal IT Staff 

  • Support and/or Managed Services 
  • Recuring Annual costs 
  • Other costs specific to the situation 


Calculate cost savings and benefits achieved by adopting Microsoft 365 security solutions.  Benefits are calculated across 3 areas: Platform adoption costs and benefits, Security Total Cost of Risk, and Platform synergy benefits.  These can include: 

  • Minimize incidents & breaches, quickly detect & remediate 
  • Synergy gains from a single, integrated platform  
  • Maximize efficiency for SecOps, IT, and Help Desk staff  
  • Microsoft FastTrack deployment guidance  
  • Other value-added benefits including:
  • Lower help desk tickets 
  • Reduce downtime 
  • BYOD hard cost avoidance 
  • Increased employee productivity 

Solution Replacement

Organizations can choose to stop using solutions that are now covered by the capabilities included in their Microsoft 365 solutions licenses. This is a critical component to justify the cost of Microsoft 365 E5 solution.  While some security solutions may work well together in a defense in depth methodology, you will want to consider replacing solutions and their subsequent cost to make best use of the Microsoft 365 E5 license investment.  

Here is a sample chart to help document current solutions and cost to come up with initial ideas of cost reduction potential.  This list is not fully inclusive, and each solution replacement decision requires a deeper conversation tailored to their situation. 


Current Solutions 

Current Cost 

Identity Management 



Conditional Access 



Multi-factor authentication 



Privileged Identity Management 



Compromised Identity Protection 



User Entity Behavior Analytics 



Identity Governance 



Mobile Device Management (MDM) 



Mobile Application Management (MAM) 



Threat Intelligence and Protection 



Message Hygiene 



Phishing Protection 



Phishing Simulation 



Email Archiving/Journaling 



Cloud Access Security Broker (CASB) 



Cloud Application Discovery 



Security Information and Event Management (SIEM) 



SOAR Automation 



Endpoint Protection and Response (EDR) 



PC Anti-Virus/Malware (endpoint protection) 



Surface Area Reduction 



Data Loss Prevention 



Data Classification and Encryption 



Information Protection and Governance  



Compliance Management 



Email Platform 



Content Management/Workflow/Collaboration 



Telephony/Phone System 



Audio Conferencing Solution 






Maintenance/Service Contract/Other 



Managed Services 






Total cost reduction potential 



Let’s be frank. Microsoft 365 E5 licenses can appear expensive at face value. $57/month/user comes out to be $684 per year per user. Enterprise Agreement and bulk discounts can slightly reduce the overall cost, but its still easily a large chunk of any organization’s IT Budget. 

If you have Microsoft 365 E3 today and are on the fence about uplifting to E5, primarily due to its cost increase, let eGroup | Enabling Technologies help you with a ROI analysis of your current environment. In many cases, with proper planning and road mapping, we have had success with many clients in significantly reducing the face value of Microsoft 365 E5 licenses by realizing the true cost and benefits of the entire package.  With cost reduction and solution replacement potential, you may very well find yourself offsetting the entire cost of the uplift to E5, plus improving overall efficiencies and security within your environment utilizing Gartner and Forrester leading solutions.  

Contact the eGroup | Enabling Technologies team today at to help you properly prepare for moving to the cloud based on Microsoft Best Practices and utilizing a secure and productive environment. 


Last updated on April 18th, 2024 at 05:26 pm