M365 License Matrix

Microsoft license comparison in a M365 License Matrix 

Microsoft 365 (formerly Office 365) is a cloud-based service from Microsoft that offers a suite of apps and services for productivity, communication, and collaboration. Despite being known for those applications, it also contains many security services designed to protect organizations’ cloud ecosystems that many companies might not know about.

Differentiating between seemingly similar plans (e.g., E3 vs. E5 or Frontline F1 vs. F3) requires a granular analysis of security controls, compliance mechanisms, and core productivity features. Without a proper understanding of these differences, an organization might overspend on security features they don’t understand or need while still having security gaps. 

In this article, we look at various licensing models and security features that M365 subscriptions offer, so you understand what might be the most appropriate license to satisfy the security requirements of your organization. We also discuss some additional security enhancements to M365 that your organization can implement to take your email security to the next level. Our analysis focuses on three key areas: general security, threat protection, and information protection.

Summary of key Microsoft 365 licensing concepts

Microsoft 365 Enterprise E3 vs E5

While both Microsoft 365 E3 and Microsoft 365 E5 offer similar Office 365 functionalities, there is a substantial difference in the security features between the E3 and E5 packages. Since Microsoft 365 is composed of Office 365, Enterprise Mobility Security 365, and Windows, we will take a closer look at each component and compare these two licensing models. The table below summarizes the differences.

As of July 1, 2026, Microsoft Defender for Office 365 Plan 1 (Safe Links, Safe Attachments, and advanced anti-phishing) is included in Microsoft 365 E3 and Office 365 E3, turning on automatically for licensed users (rollout completes August 1, 2026). Plan 2 (Automated Investigation and Response, Threat Explorer at depth, Attack Simulation Training, advanced hunting) stays in E5. See Microsoft Defender Licenses and Defender for Office 365 Plan 1 comes to E3.

Data loss prevention for Exchange, SharePoint, and OneDrive is included in E3. Endpoint DLP and Teams-chat DLP require E5.

Microsoft 365 Enterprise E3 versus E5 security features matrix

Upgrading to Microsoft 365 E5 empowers your organization with a suite of advanced tools that are critical for modern security and compliance. Below, we discuss the most important security features that this license offers compared to M365 E3 in each of the three key areas mentioned earlier: general security, threat protection, and information protection.

General security 

• Microsoft Defender for Identity: Proactive threat detection against compromised identities and risky sign-in behaviors
• Privileged Identity Management (PIM): Fine-grained administrative role management with just-in-time access and approvals
• Microsoft Entra ID Plan 2: Advanced features like access reviews, entitlement management, and risk-based conditional access for robust identity governance

Threat protection

• Microsoft Defender for Office 365 Plan 2: Provides advanced email protection (Safe Attachments, Safe Links, real-time reporting, and automated remediation) to fight zero-day attacks and advanced phishing.
• Microsoft Defender for Endpoint Plan 2: Comprehensive endpoint protection with advanced detection/response capabilities, vulnerability management, attack surface reduction, and automated investigation and response capabilities
• Microsoft Defender for Cloud Apps: Integrates with other Microsoft security solutions for cross-platform threat intelligence and coordinated response; provides visibility, threat detection, and controls for cloud app usage within your organization.

Information protection

• Microsoft Purview Information Protection: Automated classification, auto-labeling, and encryption across the Microsoft 365 suite
• Customer Key: Provides additional control over encryption for data at rest
• Customer Lockbox: Gives you approval rights over Microsoft’s access to your data in support scenarios
• Advanced eDiscovery: Extensive search, analysis, and legal hold capabilities for compliance
• Insider risk management: Identifies internal threats like data leaks or policy violations through behavioral analysis

Microsoft 365 Business Basic versus Standard versus Premium 

For small businesses venturing into the cloud, Microsoft 365 Business Basic lays the groundwork with essential online tools. Stepping up, the Standard license builds upon this with desktop Office apps and enhanced collaboration features. At the top, the Premium license caters to organizations demanding higher levels of security, comprehensive device management, and stringent compliance capabilities. It’s crucial for your organization to assess and select the Microsoft 365 plan that not only fits your operational scale and industry but also meets specific security and regulatory needs.

Business Premium already included Defender for Office 365 Plan 1 before the July 2026 change and gains nothing new from it. Business Basic and Business Standard are not affected.

Microsoft 365 Business Basic versus Standard versus Premium security features matrix

Microsoft 365 Business Premium builds the foundation for a zero-trust approach to security. Additionally, different from the rest of the Microsoft 365 Business licenses that don’t provide many security features, Microsoft 365 Business Premium can improve your overall security in different areas:

General security

• Privileged Identity Management (PIM): Just-in-time administrative access with time-bound authorization and approval workflows, reducing the attack surface of privileged roles
• Intune Plan 1: Comprehensive mobile device and application management (MDM/MAM) for in-depth device configuration, compliance enforcement, and app protection policies
• Conditional Access: Granular access controls based on device, location, user, and risk signals, providing zero-trust framework alignment

Threat protection

• Defender for Business: Comprehensive endpoint protection with advanced detection/response, vulnerability management, automated investigation and remediation, attack surface reduction, and more
• Microsoft 365 Cloud App Discovery: Analyzes your network traffic to reveal cloud app usage, including shadow IT, and assesses the risks associated with each app
• Defender for Office 365 Plan 1: Enhanced email protection with Safe Attachments, Safe Links, and real-time reporting; also protects against zero-day attacks, targeted phishing, and business email compromise

Information protection

• Microsoft Purview Information Protection: Unified data classification, labeling, and encryption across M365 apps and services; enhances compliance with data governance regulations
• Data Loss Prevention (DLP): Proactively safeguards sensitive data with policies to detect, monitor, and automatically apply protection actions (encryption, rights management, and blocking)
• Message Encryption (advanced): Granular controls for email encryption, including rights management, expiration, and revocation

How IRONSCALES can help

Considering that some Microsoft add-ons or upgrades to their existing licenses can be expensive and complex to evaluate, you can always look at other specialized solutions that complement your existing Microsoft configuration, such as IRONSCALES, which provides:

• Advanced AI-based detection: Detects phishing emails that other tools might miss.
• User training: Simulated phishing attacks and educational content help employees spot threats.

Microsoft 365 Frontline F1 versus F3 and F5 add-ons 

M365 Frontline licenses, although sometimes confused with the M365 Business licenses, focus only on frontline employees: those who work directly with customers, clients, or other recipients of services. Microsoft’s goal with M365 Frontline is to “simplify processes, unify communication tools, and engage frontline workers in a secure, all-in-one platform with Microsoft 365.” 

The table below summarizes the differences in features between M365 Frontline F1, F3, and F5.

Microsoft 365 Frontline F1 versus F3 versus F5 Add-ons security features matrix

While Microsoft 365 Frontline F1 and F3 can provide a decent level of security, the Microsoft 365 Frontline F5 Add-On vastly expands your visibility and control. Below we highlight some of the most important security enhancements, divided into the same three categories seen in the table above.

General security

• Basic mobility and security: MFA, limited device management, and passwordless authentication capabilities
• Microsoft Defender for Cloud Apps: Gives visibility and control over cloud app usage, extending security to applications that frontline workers use.
• Microsoft Entra ID Plan 2: A complete identity and access management solution offering advanced threat protection, risk-based conditional access, and identity governance tools
• Microsoft Privileged Identity Management (PIM): Increased protection for highly privileged accounts and frontline workers who might have elevated permissions

Threat protection

• Microsoft Defender for Office 365 Plan 2: A significant upgrade with Safe Attachments, Safe Links, real-time reporting, automated investigation/response, and zero-day attack protection
• Microsoft Defender for Endpoint Plan 2: Robust endpoint protection with advanced detection/response, vulnerability management, and attack surface reduction

Information protection

• Microsoft Purview Information Protection: Enables sensitivity labels for frontline workers to automatically classify and protect documents
• Data Loss Prevention (DLP): Provides policies to prevent unauthorized sharing of sensitive data handled by the frontline workforce.

How IRONSCALES can help

If your organization wants to avoid analyzing different add-ons and the complex licensing behind them while enhancing email protection, it’s worth looking at complementary solutions in the market. IRONSCALES helps organizations with:

• Detecting sophisticated phishing attacks: AI and community-sourced intelligence to enhance standard email filters.
• Automating quarantine and remediation: Suspect emails are automatically removed to protect employees.
• Training employees to spot threats: Phishing simulations and education improve awareness.
• Integrating with your existing email security: IRONSCALES natively integrates with other solutions, including M365 and GWS, via its API.

Microsoft 365 Education A3 versus A5 

M365 Education is another licensing bundle that Microsoft offers as a set of student-centered solutions that help create an equitable learning environment for all while supporting students with their learning activities. Very much like Microsoft 365 Enterprise E3 and E5, the Education bundle brings everything from the Enterprise powerhouse while additionally enhancing it with functionalities that are deemed more appropriate for educational bodies.

Based on an educational institution’s professional and security-related needs, you can choose between the M365 A3 or A5 license, whose differences are summarized in the table below.

The July 2026 change applies to Microsoft 365 E3 / Office 365 E3 (and their G3 government equivalents) only. It does not extend Defender for Office 365 Plan 1 to Education A3.

Microsoft 365 Education A3 versus A5 security features matrix

Microsoft 365 A5 is built for educational organizations that need advanced security and sensitive data protection, and it is subject to strict regulations. It ships with Information Protection, eDiscovery, and security features like the whole Microsoft Defender stack to ensure advanced security. Let’s see some of the most important security enhancements it provides, divided into the three main categories again.

General security 

• Microsoft Defender for Identity: Proactive identity-based threat detection
• Privileged Identity Management (PIM): Granular controls and just-in-time access for sensitive administrative roles
• Entra ID Plan 2: Advanced identity governance with access reviews, entitlement management, risk-based conditional access, and more
• Information barriers: Enforces communication and collaboration restrictions between groups within the organization

Threat protection

• Microsoft Defender for Office 365 Plan 2: Advanced protection against zero-day attacks, targeted phishing, ransomware, and business email compromise with Safe Attachments, Safe Links, real-time reporting, and automated remediation
• Microsoft Defender for Endpoint Plan 2: Comprehensive endpoint protection with advanced detection/response, vulnerability management, attack surface reduction, and automated investigations
• Microsoft Defender for Cloud Apps: Deep integration with other defenders for cross-platform threat intelligence and mitigation.

Information protection

• Customer Key: An additional layer of encryption control for data at rest
• Customer Lockbox: Approval rights for Microsoft accessing your data during support operations
• Advanced eDiscovery: Extensive search, analysis, and legal hold features for compliance
• Microsoft Purview Information Protection: Automated data classification, labeling, and encryption across M365
• Insider Risk Management: Identifies internal threats like data leaks or policy violations through behavioral analysis

Complementary email security integrations

Basic Microsoft 365 plans like Microsoft 365 F1, F3, and Business Basic, leave your email security vulnerable or incomplete. This could represent the right moment to leverage a comprehensive AI-powered solution for email protection, such as IRONSCALES. Their native API integration makes it easy to complement your Microsoft 365 solution with features such as:

• Advanced URL and malware protection: Scans received URLs and attachments for possible malware or phishing attempts. Compared to Defender for Office, which scans suspicious links against a list of existing threats, IRONSCALES employs a multi-layered strategy, analyzing content and communication patterns to detect and remove malware threats, suspicious URLs, and attachments in real time. 
• Crowdsourced threat intelligence: The IRONSCALES global network of 35,000+ security professionals across 17,000+ organizations shares real-time threat data that continuously sharpens the platform’s detection capabilities. Complementing this is its AI-powered threat detection capabilities to locate phishing attempts, zero-day attacks, and impersonation scams that often bypass the traditional email filters offered by Microsoft 365.
  

• Phishing simulation testing: Where Defender ships generic simulation templates, IRONSCALES builds simulations from real reconnaissance on the tactics targeting your people, so training reflects the attacks they actually face.

Related guides in this series

• Microsoft 365 email security: series introduction
• Exchange Online Protection vs Defender for Office 365
• Microsoft Defender for Office 365
• Microsoft Defender licenses
• Defender for Office 365 Plan 1 comes to E3: how to tune it

Conclusion

In this article, we explained the security features that various Microsoft 365 subscriptions offer, giving IT (security) professionals an insight into what exactly they need to choose for their organizations. The optimal M365 configuration is not necessarily the most expensive option. Based on our organization’s risk tolerance, regulatory complaint requests, and various user workflows, you might want to actually select multiple plans and even add solutions that complement the existing infrastructure, such as IRONSCALES, to achieve a robust security posture.