You need email, Word, Excel, and somewhere to put files. You go to Microsoft's pricing page and get hit with Business Basic, Business Standard, Business Premium, and a handful of enterprise plans with names like E3 that you were never supposed to read. Most small businesses overthink this, buy the wrong plan, and either overpay for features nobody uses or underpay and get stuck when the first laptop goes missing.
Here's what each plan actually gets you, and which one we recommend for most of the companies we support.
Business Basic: the web-only plan
Business Basic is the cheapest tier, running a few dollars per user per month. You get business email on your own domain through Exchange, 1 TB of OneDrive storage per person, Teams, and SharePoint. The catch: you only get the web and mobile versions of Word, Excel, and PowerPoint. No desktop apps.
The web versions are genuinely fine for light editing. They are not fine for anyone who lives in Excel, works with big files, or needs to work offline. Basic makes sense for frontline staff, part-timers, and shared mailboxes for people who mostly read email and occasionally open a document.
Business Standard: Basic plus the desktop apps
Business Standard adds the full desktop versions of Word, Excel, PowerPoint, and Outlook, installable on up to five devices per person. Everything else from Basic carries over. This is the plan most people picture when they think "Office subscription."
If your team spends the day in Outlook and Excel, Standard is the floor. Do not try to save money by putting your bookkeeper on Basic. We have watched people fight the web version of Excel over a pivot table, and the lost hours cost more than the plan difference in the first week.
Business Premium: Standard plus security and device management
Business Premium costs roughly double Standard and adds the security layer: Intune for managing company devices, Defender for Business, conditional access policies, and better protection against phishing and malicious attachments in email.
Those features sound like enterprise fluff until you need them. Intune is what lets us remotely wipe a laptop that walks off a job site. Conditional access is what stops someone in another country from logging into your email with a stolen password. Defender's email filtering catches the fake invoice before your office manager pays it.
Premium is capped at 300 users, same as the other Business plans. Almost no small business hits that ceiling.
Which one should you buy?
Our honest answer for most companies we work with:
- Business Premium for anyone with a company laptop or access to sensitive data. Owners, managers, finance, anyone handling client information. The security features are the point, not a bonus.
- Business Standard for everyday office staff if budget is tight and you have some other way to manage devices. In practice, most small businesses don't, which is why we push Premium.
- Business Basic for frontline and light users. Warehouse staff who need email and a schedule, seasonal workers, kiosk accounts.
Mixing plans is allowed and normal. A ten-person company might run four Premium, four Standard, and two Basic licenses. Microsoft lets you assign different plans to different users in the same tenant, and you can change a user's license in a couple of clicks when their role changes.
Things people get wrong
Annual versus monthly billing. Annual commitment is cheaper per month, but you are locked in for the year. If your headcount swings, keep a few licenses on monthly terms and commit the rest annually.
Buying "Microsoft 365 Personal" for business. The consumer plans do not include business email on your domain, and you lose admin control over the account. If an employee quits with company files in a personal Microsoft account, you have no recourse. Always buy the Business plans through a business tenant you control.
Assuming Microsoft backs up your data. Microsoft keeps your services running, but deleted items eventually purge, and a ransomware event or a malicious insider can trash OneDrive and SharePoint. A third-party backup for Microsoft 365 costs a few dollars per user per month and is worth it.
How to know it's set up right
Owning the right licenses is half the job. A correct setup looks like this: every account has multi-factor authentication enforced, not just available. Admin access lives in a separate account, not the owner's daily email. Email authentication records (SPF, DKIM, DMARC) are published on your domain so your invoices don't land in spam. And if you bought Premium, Intune is actually enrolled on your devices, because a license nobody configured protects nothing.
If you're not sure which plan you're on or whether any of that got configured, that's a twenty-minute check for us. We do it at the start of every new client relationship, and about half the time we find Premium licenses paying for security features that were never turned on.
Stuck on this, or want it done for you? That's the job.
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