If you’re already invested in Microsoft 365, you know the perks—centralized management, seamless integration, and predictable costs. But as cyber threats get more sophisticated and frequent, your security defenses need to evolve to keep up. That’s where Microsoft 365 E3 and Microsoft E5 come in.
On paper, E5 seems like the obvious winner—more advanced security, compliance, and analytics. But is it worth the upgrade or can you hack E3 with add-ons to get the protection you need? The decision isn’t just about security; it’s about efficiency, cost-effectiveness, and reducing complexity.
Let’s break it down.
If you’re trying to figure out whether E3 or E5 is right for your business, here’s the simple version:
And the good news is if you’re using Microsoft 365 E3 but need the advanced security features of E5, you don’t necessarily have to upgrade fully.
Microsoft offers the E5 Security add-on, which enhances E3 with E5’s security features—without requiring a complete licensing shift. (Note: The E5 Security add-on can only be applied to E3.) Compare the licensing options in detail using this Feature Matrix.
Now, let’s dive into the key advantages of E5 and why it might be worth the investment.
E5 gives you advanced features that go far beyond the basics. Here’s what sets it apart:
What’s the concern
Phishing attacks remain the easiest way for attackers to steal credentials or install malware. Fake login pages, malicious links, and social engineering tactics deceive employees daily.
How E5 Solves It
Uses AI to detect and block phishing attempts before they reach inboxes. Features like Safe Links and Safe Attachments neutralize malicious content, while Attack Simulation Training helps employees recognize threats—stopping breaches before they start.
What’s the concern
Employees frequently use unapproved apps—file-sharing tools, personal emails, and collaboration platforms—putting sensitive data at risk.
How E5 Solves It
Monitors SaaS usage, detects risky applications, and prevents unauthorized access. By identifying and controlling unapproved apps, businesses can reduce data leaks and maintain compliance without restricting productivity.
What’s the concern
Once inside a network, attackers steal credentials, escalate privileges, and move laterally to access critical systems.
How E5 Solves It
Uses behavioral analytics to detect anomalies like impossible travel, unauthorized privilege escalation, and credential theft. By identifying unusual activity early, it prevents attackers from navigating deeper into the network.
What’s the concern?
Excessive admin access increases risk. If one privileged account is compromised, attackers gain full control. Additionally, risky sign-ins can go undetected in standard security setups.
How E5 Solves It:
Entra ID P2 includes two critical security features:
What’s the concern
Most breaches start at endpoints—laptops, desktops, and mobile devices—where malware spreads quickly.
How E5 Solves It
Detects and responds to threats in real-time, automating remediation to prevent malware from spreading. It also proactively manages vulnerabilities, reducing the risk of exploitation before an attack even begins.
Security isn’t one-size-fits-all. Many companies start with E3 and upgrade key users to E5 for added protection where it matters most.
| Microsoft 365 E3 | Microsoft 365 E5 | |
| Security Level | Strong, but basic | Enterprise-grade, AI-driven |
| Cost | More affordable | Higher investment |
| Threat Detection | Standard, manual monitoring | Automated, AI-powered detection |
| Best for… | SMBs, budget-conscious orgs | Large enterprises, compliance-heavy industries |
| Third-Party Security | Often required to fill gaps | All-in-one security solution |
We recommend Microsoft 365 E5 because security should be proactive, not reactive. With E5, you get built-in AI-driven threat protection, automated response, and risk-based access controls—all in one platform. No juggling third-party tools, no gaps in coverage—just seamless, enterprise-grade security that works.
That said, we get it—budgets matter. If E5 for everyone isn’t feasible, E3 is still a solid choice. You can always upgrade high-risk users to E5 security tools while keeping costs in check.
Still unsure whether Microsoft E3 or Microsoft E5 is the right move? That’s where we come in.
Our Managed Detection and Response (MDR) services are built to leverage the advanced security tools included in Microsoft E5. As a top Microsoft Partner, we can help you maximize your investment, ensure you're getting the most out of Microsoft’s security stack, and align your defenses with your organization’s needs.
Let’s build your security strategy together. Reach out to us here.