Hereβs a breakdown of the key feature differences between Microsoft 365 Business Standard and Office 365 E3, focusing on what's relevant for most small to mid-sized businesses:
| Feature | Business Standard | Office 365 E3 |
|---|---|---|
| User Limit | 300 users max | Unlimited |
| Office Apps (Word, Excel, etc.) | β Full desktop + web + mobile | β Full desktop + web + mobile |
| Email (Exchange Online) | β 50 GB mailbox | β 100 GB mailbox + In-Place Archive |
| OneDrive Storage | β 1 TB per user | β 1 TB per user (expandable) |
| SharePoint / Teams | β Included | β Included |
| Microsoft Purview Data Loss Prevention (DLP) | β Not included | β Included |
| eDiscovery, Legal Hold | β Not included | β Included |
| Office Web Add-ins Controls (like Information Rights Management) | β Not included | β Included |
| Customer Lockbox, Message Encryption | β Not included | β Included |
| Power Apps / Power Automate Premium connectors | β Not included | β Not included (requires additional license) |
| On-premises CAL rights | β Not included | β Included (for hybrid Exchange, Skype for Business, etc.) |
Choose Business Standard if:
Youβre under 300 users.
You donβt need advanced compliance, archiving, or security features.
You want full Office apps, cloud storage, Teams, and email β and that's enough.
Choose Office 365 E3 if:
You need more than 300 users.
You need archiving, compliance tools, DLP, eDiscovery, or legal hold.
You're in a regulated industry or need enhanced control/security.
Microsoft 365 E3:
Microsoft 365 E3 is a bundle that includes Office 365 E3 + additional security and management features. It includes everything in Office 365 E3, plus:
β Windows Enterprise license
β Microsoft Entra ID Premium P1
β Microsoft Intune
β
Advanced security, device management, and compliance tools
| Exchange Online Plan 1 | Microsoft 365 Business Standard | Office 365 E3 | |
|---|---|---|---|
| Email Hosting (Exchange) | β 50 GB mailbox | β 50 GB mailbox | β 100 GB mailbox + Archive |
| Outlook Web Access | β | β | β |
| Exchange ActiveSync | β | β | β |
| In-Place Archive Mailbox | β | β | β 100 GB + expandable |
| eDiscovery & Legal Hold | β | β | β |
| DLP (Data Loss Prevention) | β | β | β |
| Office Apps (Word, Excel, etc.) | β | β (desktop/web/mobile) | β (desktop/web/mobile) |
| OneDrive for Business (1 TB) | β | β | β |
| Microsoft Teams | β | β | β |
| SharePoint Online | β | β | β |
| Business-class email + calendar | β | β | β |
| Maximum Users | Unlimited | 300 | Unlimited |
| Microsoft Entra ID Free | β | β | β |
| Use Case | Best Option |
|---|---|
| Just need email | β Exchange Online Plan 1 |
| Need email + Office apps + Teams + storage | β Microsoft 365 Business Standard |
| Need all that + archiving, DLP, compliance tools | β Office 365 E3 |
Great question β yes, both Business Standard and Office 365 E3 include Entra ID, but not at the same level.
Here's the breakdown:
| Business Standard | Office 365 E3 | |
|---|---|---|
| Included Tier | Entra ID Free | Entra ID Free |
| Can Join Devices to Entra ID (Azure AD) | β | β |
| Single Sign-On (SSO) to Microsoft 365 Apps | β | β |
| Self-Service Password Reset (Cloud only) | β | β |
| Basic Security Defaults (MFA prompt for all users) | β | β |
| Conditional Access Policies | β | β |
| Hybrid Join / Group-Based Licensing / Identity Governance | β | β |
| Privileged Identity Management (PIM) | β | β |
or Entra ID P2 (for more advanced identity protection)
These are not included with either Business Standard or Office 365 E3 β you'd license them separately or get them as part of Microsoft 365 E3 or E5 (which include more security and management features beyond just Office).