30+
Enterprise add-ons catalogued with EA pricing
$2–$30
Per-user/month add-on price range
15–30%
Of total M365 spend is add-ons at most enterprises
30–50%
Of add-on spend is avoidable through right-sizing
How to Use This Guide
Each add-on entry below includes four data points you will not find together in Microsoft’s own documentation: the list price, the achievable EA price (what mid-to-large enterprises actually pay), the prerequisite base licence required, and an independent verdict with specific guidance on who needs it, who does not, and the E3+add-on vs E5 crossover calculation where applicable.
Add-ons are tagged for quick scanning:
Included in E5 — already included in M365 E5; only purchase if on E3/E1/F-series
Recommended — high value for the indicated roles; negotiate into EA
Evaluate Carefully — Microsoft pushes hard; ROI varies; pilot first
New / Changed 2025–26 — new add-on, restructured pricing, or changed bundling
Niche — needed by specific roles or industries only
“The most expensive Microsoft licence is the one you buy for someone who doesn’t need it. Add-on sprawl is more damaging than headline pricing, because add-ons multiply across thousands of seats before anyone runs the total.”
AI and Copilot Add-Ons
Microsoft’s fastest-growing and most aggressively marketed add-on category. Copilot alone can increase your M365 bill by 50–80% if deployed broadly.
Microsoft 365 CopilotNewEvaluate Carefully$30/user/mo+
List Price
$30/user/month ($360/year)
EA Price Range
$23–$28/user/month
Prerequisite
M365 E3, E5, Business Standard, or Business Premium
Minimum Seats (Typical EA)
300–500 seats (negotiable)
What it does: AI assistant embedded in Word, Excel, PowerPoint, Outlook, Teams, and OneNote. Drafts content, summarises meetings, analyses spreadsheets, generates presentations from documents, and answers natural-language queries across your Microsoft Graph data.
Who needs it: Executives, legal, marketing, analysts, and project managers who spend 3+ hours daily creating written content, analysing data, or managing email. These roles see 30–45 minutes/week productivity gains in early adoption data.
Who does not: Frontline workers, field staff, light email users, and roles that primarily consume content rather than create it. Deploying Copilot to these roles generates minimal measurable ROI.
Verdict: Pilot 8–12% of users for 90 days, measure by role, deploy to roles exceeding break-even ($312/year value at $40/hour = ~8 hours saved/year). Negotiate independently from base EA with annual exit rights. At $30 list for 100% of users, Copilot costs more than the E3 base for many organisations. Deploy selectively. See
M365 Cost 2026: Copilot analysis.
Copilot StudioNewNiche$200/tenant/mo+
List Price
$200/tenant/month (includes 25,000 messages)
EA Price Range
$170–$190/tenant/month
Prerequisite
M365 E3 or E5 (any plan that includes Power Virtual Agents rights)
Overage
$0.01 per additional message
What it does: Build custom AI agents and chatbots that connect to your organisational data, automate workflows, and interact with users through Teams or web. Replaces the legacy Power Virtual Agents standalone product.
Who needs it: IT teams and citizen developers building internal chatbots for HR, IT helpdesk, knowledge management, or customer-facing conversational AI. Organisations with 5+ planned bots and high message volume.
Verdict: Niche but high-value for organisations investing in internal AI automation. The 25,000 message inclusion is adequate for pilot and mid-scale deployment. Monitor message consumption carefully — overage costs accumulate quickly at enterprise scale. Evaluate against third-party alternatives (Intercom, Drift, custom LLM implementations) before committing.
Security and Compliance Add-Ons
The largest add-on category by spend and the one where the E3-to-E5 crossover calculation matters most. Many of these are included in E5 — if you need 3 or more, E5 is usually cheaper than E3 + standalone add-ons.
Microsoft Defender for Endpoint Plan 2Included in E5Recommended$5.20/user/mo+
List Price
$5.20/user/month ($62.40/year)
EA Price Range
$4.00–$4.80/user/month
Prerequisite
M365 E3 (includes Defender P1); adds P2 capabilities
Included in E5?
Yes — full Defender for Endpoint P2
What it does: Advanced endpoint detection and response (EDR), automated investigation, threat hunting, attack surface reduction, and vulnerability management beyond the Defender P1 baseline included in E3.
Who needs it: Every device in your organisation benefits from EDR. Security teams require P2 for investigation and hunting capabilities. This is the most universally valuable security add-on.
Verdict: Strongly recommended for all E3 customers. If you are buying Defender P2 for >50% of users, calculate the E5 crossover — E5 includes P2 plus Azure AD P2, Power BI Pro, Phone System, and advanced compliance. At 60%+ of users needing P2, E5 is almost certainly cheaper than E3 + P2 standalone.
Microsoft Defender for Office 365 Plan 2Included in E5$5.00/user/mo+
List Price
$5.00/user/month
EA Price Range
$3.80–$4.50/user/month
Prerequisite
M365 E3 (includes Defender for Office P1)
What it does: Advanced anti-phishing with impersonation protection, attack simulation training, automated investigation and response (AIR), and threat explorer for email and collaboration security.
Who needs it: Organisations experiencing frequent phishing attacks or operating in high-risk sectors (financial services, government, healthcare). The attack simulation training alone justifies the cost for security-conscious organisations.
Verdict: Valuable for organisations with significant email-borne threat exposure. If you already plan to add Defender for Endpoint P2, buying both standalone ($10.20/user/month combined) approaches the E5 upgrade premium — recalculate the E5 crossover.
Microsoft Defender for IdentityIncluded in E5Niche$5.50/user/mo+
List Price
$5.50/user/month
EA Price Range
$4.20–$5.00/user/month
Prerequisite
Any M365 plan or standalone
What it does: Monitors Active Directory signals to detect identity-based threats: lateral movement, credential theft, privilege escalation, and compromised accounts in hybrid environments.
Verdict: Essential for organisations running hybrid Active Directory. Cloud-only Azure AD environments derive less value. If your identity infrastructure is already fully migrated to Azure AD, this add-on provides limited incremental protection over Azure AD P2’s identity protection features.
Microsoft Defender for Cloud AppsIncluded in E5$3.50/user/mo+
List Price
$3.50/user/month
EA Price Range
$2.80–$3.20/user/month
Prerequisite
Any M365 plan or standalone
What it does: Cloud Access Security Broker (CASB) that discovers shadow IT SaaS usage, enforces DLP policies across cloud apps, detects anomalous user behaviour, and controls OAuth app permissions. Monitors over 31,000 cloud apps including Salesforce, Box, Dropbox, and Google Workspace.
Who needs it: Organisations with significant SaaS adoption beyond Microsoft’s own apps. Particularly valuable for detecting unauthorised cloud app usage (shadow IT) and enforcing data governance across multi-vendor cloud environments.
Verdict: Increasingly important as SaaS sprawl grows. At $3.50/user/month, it is one of the cheaper E5-included security add-ons and one of the most underappreciated. If you are evaluating standalone CASB products (Netskope, Zscaler), compare Defender for Cloud Apps — it integrates natively with the M365 ecosystem and may eliminate the need for a separate CASB investment.
Microsoft Purview Compliance Manager PremiumNiche$12.00/user/mo+
List Price
$12.00/user/month
EA Price Range
$9.50–$11.00/user/month
Prerequisite
M365 E3 or E5
Included in E5?
Partially — E5 includes base Compliance Manager; Premium adds advanced assessments
What it does: Advanced regulatory compliance assessments for GDPR, HIPAA, SOX, ISO 27001, NIST, and 300+ additional regulatory frameworks with automated evidence collection and continuous monitoring.
Who needs it: Compliance officers and GRC teams in regulated industries (financial services, healthcare, government) managing multiple regulatory frameworks simultaneously.
Verdict: Deploy only to compliance, legal, and audit team members who actively manage regulatory assessments — typically 2–5% of the user base. Do not license organisation-wide. At $12/user/month for 50 compliance staff instead of 5,000 total users, the cost difference is $594K/year.
Microsoft Purview Information Protection (Advanced)Included in E5$7.00/user/mo+
List Price
$7.00/user/month
EA Price Range
$5.50–$6.50/user/month
What it does: Advanced DLP policies, trainable classifiers, exact data matching, auto-labelling with sensitivity labels, and advanced encryption controls beyond the basic Information Protection included in E3.
Verdict: Necessary for organisations handling regulated data (PII, financial records, health information) at scale. If you need both DLP and Defender P2, the combined standalone cost ($12.20/user/month) triggers the E5 crossover for most organisations.
Identity and Access Management
Identity is the new perimeter. These add-ons govern who accesses what — and the difference between P1 (in E3) and P2 (in E5) is the difference between prevention and detection.
Microsoft Entra ID P2 (Azure AD P2)Included in E5Recommended$9.00/user/mo+
List Price
$9.00/user/month ($108/year)
EA Price Range
$7.00–$8.00/user/month
Prerequisite
M365 E3 (includes Entra ID P1)
What it does: Identity Protection (risk-based conditional access), Privileged Identity Management (PIM for just-in-time admin access), access reviews, and entitlement management beyond P1’s conditional access and MFA.
Who needs it: All organisations with privileged admin accounts (which is all organisations). PIM alone justifies the cost by reducing standing admin privileges. Identity Protection adds risk signals that prevent credential-based attacks.
Verdict: One of the highest-ROI add-ons for E3 customers. Deploy P2 at minimum to all IT admins, security team, and any user with elevated privileges. For broader deployment, Entra ID P2 ($9) + Defender P2 ($5.20) = $14.20/user/month — at which point E5 at $21 incremental over E3 is clearly better value because you also get Phone System, Power BI Pro, and advanced compliance.
Microsoft Entra ID GovernanceNewNiche$7.00/user/mo+
List Price
$7.00/user/month
EA Price Range
$5.50–$6.50/user/month
Prerequisite
Entra ID P1 (in E3) or P2 (in E5)
Included in E5?
No — separate add-on to both E3 and E5
What it does: Lifecycle workflows, machine-learning-driven access reviews, separation-of-duties checks, and advanced entitlement management for external identities. Extends beyond the basic governance in P2.
Verdict: Valuable for large enterprises with complex identity lifecycle requirements (10,000+ identities, frequent M&A, significant external collaboration). For most mid-market organisations, Entra ID P2’s built-in access reviews and PIM provide sufficient governance without this add-on.
Telephony and Teams Add-Ons
Teams Phone is Microsoft’s fastest-growing collaboration add-on. The licensing model has three layers — phone system, calling connectivity, and calling plan — each priced separately.
Teams Phone StandardIncluded in E5Recommended$8.00/user/mo+
List Price
$8.00/user/month
EA Price Range
$6.00–$7.50/user/month
Prerequisite
M365 E3 (or any M365/O365 plan)
What it does: Cloud PBX functionality in Teams: call queues, auto-attendants, voicemail, call transfer, hold, and park. Does not include PSTN connectivity — you need a Calling Plan, Direct Routing, or Operator Connect separately.
Verdict: Required for any PSTN calling through Teams. The phone system itself is the cheaper component — the real cost decision is how you connect to PSTN (see below). E5 includes Phone Standard, making it one of the key crossover features.
Microsoft Teams Domestic Calling PlanEvaluate Carefully$12.00/user/mo+
List Price
$12.00/user/month (3,000 domestic minutes)
EA Price Range
$10.00–$11.00/user/month
International Plan
$24.00/user/month (3,000 domestic + 600 international minutes)
Pay-As-You-Go
$0/user/month + per-minute charges
What it does: Provides PSTN connectivity through Microsoft’s network. Included minutes vary by country. Overage charges apply beyond the minute allowance.
Who needs it: Organisations wanting the simplest PSTN setup with no infrastructure. Small or mid-size deployments (<500 calling users) where simplicity outweighs cost optimisation.
Verdict: Microsoft Calling Plans are 40–60% more expensive than
Direct Routing through a third-party SBC provider, which costs $3–$6/user/month for equivalent service with more international flexibility. For organisations with 500+ calling users, Direct Routing or Operator Connect saves $100K–$500K annually. Evaluate before defaulting to Microsoft’s Calling Plan. See
M365 Cost 2026: telephony analysis.
Teams PremiumNewEvaluate Carefully$10.00/user/mo+
List Price
$10.00/user/month
EA Price Range
$8.00–$9.00/user/month
Prerequisite
Any M365 or O365 plan
Included in E5?
No — separate add-on
What it does: AI-powered meeting features: intelligent meeting recap with AI-generated notes, chapters, and action items; custom branded meeting templates; advanced meeting protection (watermarking, sensitivity labels on meetings); and advanced webinar and town hall capabilities.
Verdict: The intelligent recap feature overlaps significantly with Copilot in Teams. If you are deploying Copilot, Teams Premium adds limited incremental value for meeting AI. The branded templates and advanced webinar features are valuable for organisations that host frequent external webinars or town halls. Deploy to event organisers and external-facing teams, not broadly.
Analytics and Power Platform
Power Platform is Microsoft’s “free at the start, expensive at scale” strategy. Seeded capabilities in M365 are deliberately limited to drive premium add-on purchases.
Power BI ProIncluded in E5$10.00/user/mo+
List Price
$10.00/user/month
EA Price Range
$8.00–$9.00/user/month
Power BI Premium Per User (PPU)
$20.00/user/month (includes Pro + advanced AI, paginated reports, larger datasets)
Included in E5?
Power BI Pro — yes. PPU — no.
What it does: Full Power BI authoring and sharing, publish dashboards, collaborate on reports, create apps, and share content across the organisation. The free Power BI in M365 E3 allows viewing only — not creating or sharing.
Verdict: Essential for analysts, finance, operations, and any role that creates data visualisations. For “view-only” consumers of reports, Power BI Free (included in E3) is sufficient — embed reports in Teams or SharePoint for consumption without Pro licences. Deploy Pro only to content creators, typically 10–20% of users. E5 includes Pro, making it a significant crossover feature.
Power Apps per UserEvaluate Carefully$20.00/user/mo+
Per-User Plan
$20.00/user/month (unlimited apps)
Per-App Plan
$5.00/user/app/month (single app access)
EA Price Range
$16–$18/user/month (per-user); $4–$4.50/user/app (per-app)
Seeded in M365?
Yes — limited: standard connectors only, no Dataverse, no premium connectors
What it does: Build custom business applications with low-code tools. Premium connectors (SQL Server, Dataverse, SAP, Salesforce, HTTP), AI Builder, and custom APIs require premium licences above the seeded M365 entitlement.
Verdict: The seeded Power Apps capability in M365 is a deliberate gateway — it lets citizen developers start building, then requires premium licences when they need real data sources. Model the per-app vs per-user cost before broad deployment. For users accessing 1–3 specific apps, per-app at $5/app is dramatically cheaper than per-user at $20. For builders creating many apps, per-user makes sense. Watch for uncontrolled citizen development that creates licensing exposure.
Power Automate per UserEvaluate Carefully$15.00/user/mo+
Per-User Plan
$15.00/user/month (unlimited flows)
Per-User with RPA
$40.00/user/month (includes attended RPA bots)
EA Price Range
$12–$13.50/user/month (standard)
Seeded in M365?
Yes — limited: standard connectors, 6,000 actions/day
What it does: Workflow automation with premium connectors, custom connectors, business process flows, and (with RPA plan) attended desktop automation bots.
Verdict: Same licensing gateway pattern as Power Apps. The seeded M365 entitlement covers basic flows (SharePoint triggers, approval workflows) but premium connectors require paid licences. Licence only active flow builders, not flow consumers. The per-user with RPA plan at $40/user/month is expensive — evaluate UiPath and other RPA alternatives before committing to Microsoft’s RPA pricing.
Device Management
Intune is included in M365 E3. The add-ons below extend Intune for complex device estates — but most organisations have not fully utilised their base Intune entitlement before buying add-ons.
Microsoft Intune SuiteNewNiche$10.00/user/mo+
List Price
$10.00/user/month
EA Price Range
$8.00–$9.00/user/month
Prerequisite
M365 E3 or E5 (includes Intune Plan 1)
Individual add-ons
Available separately: Remote Help ($3.50), Endpoint Privilege Management ($3.00), Advanced Analytics ($3.00), etc.
What it does: Bundle of advanced Intune capabilities: Remote Help, Endpoint Privilege Management, Advanced Analytics, Microsoft Tunnel for MAM, and Firmware-over-the-air updates. Each is available individually.
Verdict: Only purchase the suite if you need 3+ of the individual capabilities. Most organisations benefit from Endpoint Privilege Management alone ($3/user/month) — which removes local admin rights while allowing controlled elevation. Remote Help is valuable for helpdesk teams supporting remote workers. Buy individual components rather than the full suite unless you can justify all five.
Windows AutopatchIncluded in E3/E5Included+
What it does: Automated Windows quality and feature update management through Intune, with ring-based deployment, monitoring, and automatic rollback.
Verdict: Included in M365 E3/E5 at no additional cost. Many organisations are still paying for WSUS infrastructure or third-party patching tools while this is already included. Evaluate whether Autopatch can replace your existing patching solution — saving both licence and infrastructure costs.
Employee Experience
Microsoft Viva is Microsoft’s employee experience platform — bundling analytics, learning, engagement, and communications. The licensing is complex: some features are in M365, some require add-ons, and the bundle vs individual pricing creates confusion by design.
Microsoft Viva SuiteEvaluate Carefully$12.00/user/mo+
List Price
$12.00/user/month (full suite)
EA Price Range
$9.50–$11.00/user/month
Individual modules
Viva Learning ($4), Viva Insights ($4), Viva Engage ($4), Viva Goals ($6) — sold separately
Included in M365?
Basic Viva Insights and Viva Connections included in E3/E5
What it does: Viva Learning (LMS integration, learning paths), Viva Insights (productivity analytics, manager dashboards, focus time), Viva Engage (employee communities replacing Yammer premium), Viva Goals (OKR tracking), Viva Amplify (corporate communications), and Viva Glint (employee surveys — separate pricing).
Verdict: Most organisations use 1–2 Viva modules, not the full suite. At $12/user/month for the suite versus $4/user/month for a single module, the suite is only cost-effective if you deploy and actively use 3+ modules. Buy individual modules for the specific teams that use them: Viva Learning for L&D and new hires, Viva Insights for managers and HR analytics, Viva Goals for OKR-driven teams. Do not license the suite organisation-wide unless you have validated adoption across all modules.
The E3 + Add-Ons vs E5 Decision Framework
The most important commercial decision in Microsoft 365 add-on licensing is not which add-ons to buy — it is when the accumulation of add-ons on E3 exceeds the cost of simply upgrading to E5. Microsoft designs the add-on pricing deliberately to create this crossover, pushing organisations toward E5 once they reach 2–3 security add-ons.
| Scenario | E3 Base | Add-On Total | E3 + Add-Ons | E5 Cost | Winner |
|---|
| E3 + Defender P2 only | $36.00 | $5.20 | $41.20 | $57.00 | E3 + Add-On |
| E3 + Defender P2 + Azure AD P2 | $36.00 | $14.20 | $50.20 | $57.00 | E3 + Add-Ons |
| E3 + Defender P2 + Azure AD P2 + Power BI Pro | $36.00 | $24.20 | $60.20 | $57.00 | E5 |
| E3 + Defender P2 + Azure AD P2 + Phone System | $36.00 | $22.20 | $58.20 | $57.00 | E5 |
| E3 + 3 security add-ons + Power BI | $36.00 | $29.20 | $65.20 | $57.00 | E5 (by $8.20) |
The Crossover Rule of Thumb
If a user needs 3 or more E5-included add-ons, E5 is cheaper than E3 + standalone add-ons at list price. At negotiated EA rates, the crossover occurs at 2–3 add-ons (because EA E5 discounts are deeper percentage-wise than EA add-on discounts).
The optimal strategy for most enterprises: E5 for 15–30% of users (security, IT, legal, compliance, analysts) who need 3+ premium features, E3 for 50–60% (information workers needing standard productivity), and F3/F1 for 20–30% (frontline workers). This mixed-SKU approach saves 15–25% versus blanket E5 deployment.
The Complete Add-On Cost Table
For reference, here is every major add-on in one table with list and EA pricing, sorted by category:
| Add-On | List/User/Mo | EA Range | In E5? |
|---|
| AI & Copilot | | | |
| Microsoft 365 Copilot | $30.00 | $23–$28 | No |
| Copilot Studio (tenant) | $200/tenant | $170–$190 | No |
| Security | | | |
| Defender for Endpoint P2 | $5.20 | $4.00–$4.80 | Yes |
| Defender for Office 365 P2 | $5.00 | $3.80–$4.50 | Yes |
| Defender for Identity | $5.50 | $4.20–$5.00 | Yes |
| Defender for Cloud Apps | $3.50 | $2.80–$3.20 | Yes |
| Purview Information Protection | $7.00 | $5.50–$6.50 | Yes |
| Purview Compliance Manager Premium | $12.00 | $9.50–$11.00 | Partial |
| Identity | | | |
| Entra ID P2 (Azure AD P2) | $9.00 | $7.00–$8.00 | Yes |
| Entra ID Governance | $7.00 | $5.50–$6.50 | No |
| Telephony | | | |
| Teams Phone Standard | $8.00 | $6.00–$7.50 | Yes |
| Teams Domestic Calling Plan | $12.00 | $10–$11 | No |
| Teams International Calling Plan | $24.00 | $20–$22 | No |
| Teams Premium | $10.00 | $8–$9 | No |
| Analytics & Power Platform | | | |
| Power BI Pro | $10.00 | $8–$9 | Yes |
| Power BI Premium Per User | $20.00 | $16–$18 | No |
| Power Apps per User | $20.00 | $16–$18 | No |
| Power Apps per App | $5.00/app | $4–$4.50 | No |
| Power Automate per User | $15.00 | $12–$13.50 | No |
| Power Automate per User + RPA | $40.00 | $33–$37 | No |
| Device Management | | | |
| Intune Suite | $10.00 | $8–$9 | No |
| Intune Endpoint Privilege Mgmt | $3.00 | $2.40–$2.80 | No |
| Intune Remote Help | $3.50 | $2.80–$3.20 | No |
| Employee Experience | | | |
| Viva Suite | $12.00 | $9.50–$11 | No |
| Viva Learning / Insights / Engage | $4.00 each | $3.20–$3.60 | Basic in E3/E5 |
| Viva Goals | $6.00 | $4.80–$5.50 | No |
How to Negotiate Add-On Pricing in Your EA
Add-ons are where Microsoft has the widest pricing variability — and where most organisations leave the most money on the table. Base M365 E3/E5 pricing is well-benchmarked and tightly managed by Microsoft’s pricing desk. Add-on pricing has more discretionary room because add-ons are newer, less benchmarked, and Microsoft is motivated to drive adoption.
Negotiate add-ons as a separate line item. Microsoft’s preferred approach is to bundle add-ons into the blended EA price, making it impossible to track what you pay for each component. Insist on itemised per-add-on pricing so you can evaluate, adjust, and exit each add-on independently at each EA anniversary.
Demand annual exit rights on every add-on. Base M365 subscriptions are committed for the EA term. Add-ons should not be — particularly new products like Copilot, Teams Premium, and Viva modules where enterprise ROI is still being established. The right to reduce or eliminate add-on seats at each anniversary without penalty protects you from paying for products that underperform expectations.
Use the E5 crossover as leverage. When negotiating standalone add-on pricing, explicitly model the E5 alternative for Microsoft’s sales team. If E3 + 3 add-ons exceeds E5, tell them: “We can either buy these add-ons at $X, or we will upgrade these users to E5. Help us make the standalone route cost-effective.” This creates downward pressure on add-on pricing because Microsoft earns more margin on add-ons than on E5 upgrades.
Pilot before committing at volume. For any add-on being deployed for the first time, negotiate a 90-day pilot at reduced pricing (50–75% of full rate) with a defined set of success criteria. If the pilot meets criteria, you commit at the negotiated volume rate. If it does not, you exit without penalty. This structure is achievable for Copilot, Teams Premium, Viva modules, and Intune Suite — products Microsoft is actively trying to scale.
Frequently Asked Questions
What are the most important Microsoft 365 add-ons for enterprise security?+
The three highest-impact security add-ons for E3 customers are: Defender for Endpoint P2 ($5.20/user/month) for endpoint detection and response, Entra ID P2 ($9/user/month) for privileged identity management and identity protection, and Defender for Office 365 P2 ($5/user/month) for advanced anti-phishing and email threat protection. All three are included in M365 E5. If you need all three, upgrading to E5 is cheaper than buying them standalone.
When should I upgrade to E5 instead of buying add-ons?+
Upgrade to E5 when a user needs 3 or more E5-included features (Defender P2, Azure AD P2, Power BI Pro, Phone System, advanced compliance). At 3 add-ons, the combined standalone cost ($19–$25/user/month) approaches or exceeds the E3-to-E5 upgrade premium ($21/user/month at list). At negotiated EA rates, the crossover occurs at 2–3 add-ons. The optimal strategy: E5 for the 15–30% of users who need premium capabilities, E3 for the remainder.
How much does Microsoft Copilot add to the per-user cost?+
Copilot adds $30/user/month at list price ($23–$28 at EA rates), increasing the per-user cost by 64–83% on an E3 base or 40–53% on an E5 base. Copilot is
not included in E5 — it is always a separate add-on. Negotiate it independently from your base EA with volume discounts, pilot terms, and annual exit rights. See
M365 Cost 2026 for full Copilot cost analysis.
Are Microsoft Teams Calling Plans worth the cost?+
For small deployments (<500 calling users), Calling Plans offer simplicity that may justify the premium. For larger deployments, Direct Routing through a third-party SBC provider delivers equivalent PSTN connectivity at $3–$6/user/month versus $12–$24 for Microsoft Calling Plans — saving 40–70%. Evaluate Direct Routing or Operator Connect before committing to Calling Plans at EA renewal.
What Power Platform licensing do I need beyond M365?+
M365 E3/E5 includes “seeded”
Power Apps and Power Automate with standard connectors only. The moment you need
premium connectors (SQL, Dataverse, SAP, HTTP, custom APIs),
AI Builder, or
Dataverse storage beyond 1GB, you need premium licences: Power Apps per User ($20/user/month) or per App ($5/user/app), and Power Automate per User ($15/user/month). Model the cost at intended scale before allowing broad citizen-developer adoption.
How can I reduce add-on spending without reducing security?+
Three strategies: (1) Upgrade to E5 for power users who need 3+ security add-ons (cheaper than standalone), (2) segment deployment so add-ons go only to users who need them (compliance tools to compliance teams, not everyone), and (3) audit feature utilisation — if you are paying for an add-on that fewer than 30% of assigned users actively use, reassign or remove it. Most organisations find 30–50% of add-on licences are under-utilised.