E5 Security Bundle vs Standalone Licenses
Introduction: Why the E5 Security vs Standalone Question Matters
Many organizations using Microsoft 365 E3 face pressure to upgrade or add on security features. Microsoft’s sales teams often promote the E5 Security add-on bundle as a one-stop upgrade for advanced security.
However, deciding between the Microsoft 365 E5 Security bundle and individual standalone licenses isn’t straightforward. The key question: is the bundle truly cost-effective, or can a mix-and-match approach save money?
Microsoft’s licensing is notoriously complex, especially around security bundles.
The E5 Security add-on promises simplicity by combining multiple tools under one license. Read our overview for Microsoft Security Solutions Licensing.
But paying for a bundle might mean buying features you don’t need or won’t fully use.
A pragmatic cost analysis can help determine whether the bundle or à la carte standalones will be more cost-effective for your specific needs.
What’s Included in the Microsoft E5 Security Bundle
The Microsoft 365 E5 Security add-on costs roughly $12–$15 per user per month, depending on region and commitment term.
It packages several premium security components into a single bundle.
Core components of the E5 Security bundle include:
- Azure AD Premium P2 – Advanced identity protection and privileged identity management.
- Microsoft Defender for Endpoint – Endpoint detection and response for devices.
- Microsoft Defender for Office 365 (Plan 2) – Advanced email and collaboration threat protection (formerly Office 365 ATP P2).
- Microsoft Defender for Cloud Apps – Cloud Access Security Broker (formerly Cloud App Security) for SaaS app visibility and control.
- Microsoft Defender for Identity – On-premises Active Directory threat monitoring (formerly Azure ATP).
In essence, the E5 Security add-on is like getting Enterprise Mobility + Security (EMS) E5 plus the Office 365 advanced threat protection features in one discounted package.
This bundle approach provides organizations with a comprehensive defensive stack featuring tight integration between tools.
Standalone Security Licenses: A La Carte Options
Each E5 Security component is also available as a standalone license that can be purchased individually.
For example, approximate standalone prices per user per month:
- Defender for Endpoint (Plan 2) – around $5
- Defender for Office 365 (Plan 2) – around $3–$5
- Azure AD Premium P2 – around $6
- Defender for Cloud Apps – around $5
- Defender for Identity – around $5
Organizations can choose an à la carte mix if they only require one or two specific security solutions. For instance, a company might purchase just Defender for Endpoint to enhance device security without upgrading the entire suite.
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Buying individually can be cheaper when you truly need only one or two tools – you avoid paying for features that aren’t used.
However, standalone licenses start to add up in cost (and complexity) as you layer on more products. Managing multiple separate security subscriptions can also become a headache for procurement and compliance.
It’s essential to compare the total cost of the needed standalones against the bundle price to determine which route optimizes spending.
Optimize your entitlements, Maximizing Value from Microsoft Security Licenses: Use What You Already Own.
Break-Even Analysis: Bundle vs Standalone Costs
The breakeven point between an E5 Security bundle and standalone licenses depends on the number of components you actually need.
If you need only one security component, the standalone license is almost always cheaper.
Example: Only require Defender for Endpoint (~$5) – much less than the ~$12 bundle price.
If you need two or more components, the bundle is usually more economical.
Example: Azure AD P2 (~$6) + Defender for Endpoint (~$5) = ~$11. Add Defender for Office 365 (~$3), and the total is ~$14, above the ~$12 bundle.
If you need nearly all the advanced tools, the E5 Security bundle is significantly more cost-effective. Buying all five tools individually might cost around $25–$30 per user, versus ~$12 in the bundle (over 50% savings).
The more security add-ons you adopt, the more the bundle “shortcut” makes financial sense from a licensing cost perspective.
That said, true cost-effectiveness depends on actual usage – paying 50% less is still wasteful if you’re not using half of the features.
Always evaluate which security solutions will be actively used in your environment. If you won’t deploy a component soon, don’t consider its standalone cost as “avoided” by the bundle.
Beyond price, consider the value of integration: the E5 Security bundle tools work together out of the box. Separate point solutions might require more effort and may not share signals as seamlessly as Microsoft’s unified Defender stack.
If cost optimization is the priority, a simple rule of thumb applies:
- For single security needs: choose standalone licenses.
- For multi-component security needs, the E5 Security bundle likely offers better value per user.
For more insights, Microsoft Sentinel SIEM Pricing: Licensing Options and Optimization.
EMS E5 vs M365 E5 Security: Clearing Up Confusion
Microsoft’s naming can confuse IT buyers – especially the distinction between Enterprise Mobility + Security (EMS) E5 and the M365 E5 Security add-on.
EMS E5 is a separate bundle focusing on device and identity management. It includes Azure AD Premium P2, Microsoft Intune, Azure Information Protection P2, Defender for Identity, and Defender for Cloud Apps.
By itself, EMS E5 provides the most advanced security features except those specific to Office 365. It’s priced around ~$11 per user, often as an add-on upgrade for E3 customers.
Microsoft 365 E5 Security is effectively “EMS E5 plus Office 365 security.” It encompasses everything in EMS E5 and also adds Defender for Office 365.
The E5 Security add-on is designed for organizations with E3 plans that want top-tier security without paying for the full E5 suite.
(The full E5 license includes other non-security extras like Phone System and Power BI that many companies don’t need.)
EMS E5 vs M365 E5 Security: If you purchase EMS E5 alone, you get core security but miss cloud email protection. The M365 E5 Security add-on covers that gap by including Office 365 Defender features as well.
The Microsoft 365 E5 Security add-on can be layered on top of a Microsoft 365 E3 license (which already includes EMS E3) to upgrade all security areas at once.
It’s also available to Office 365 E3 customers, but typically, they need to have (or add) EMS E3 as a base first.
In practice, the M365 E5 Security add-on is often a better deal than trying to combine EMS E5 with a separate Office 365 ATP license.
EMS E5 by itself might be slightly cheaper per user, but once you add a separate Office 365 email security license, you likely end up paying as much as (or more than) the E5 Security bundle.
The E5 Security bundle also benefits from bundle discounts and simpler license management (one SKU instead of multiple separate licenses).
Remember, EMS E5 is missing some elements that the M365 E5 Security bundle includes (notably Office 365 ATP Plan 2 email protection).
Not surprisingly, Microsoft encourages enterprises to adopt the all-in-one E5 Security add-on for comprehensive coverage.
Comparison Table – Bundle vs Standalone
| Option | Components Included | Monthly Cost per User | Best For | Risk / Drawback |
|---|---|---|---|---|
| Standalone | Choose only 1–2 specific tools | ~$5–$12 (depends on picks) | Targeted needs where only minimal features are required | Costs add up quickly if you expand scope |
| EMS E5 | Core security suite + Intune | ~$11 (approximate) | E3 organizations needing full EMS features without Office ATP | Missing Office 365 ATP P2 (no email threat protection) |
| M365 E5 Security | All major security add-ons | ~$12–$15 | E3 enterprises needing multiple advanced security tools | Paying for unused features if adoption is low |
Checklist: How to Decide Between E5 Security and Standalone
- Inventory your current E3 entitlements: Document what security capabilities you already have with Microsoft 365 E3 or Office 365 E3 (e.g. basic MFA, Intune, etc.).
- Map user needs and risks: Identify which security areas are crucial – identity protection, endpoint security, email threat defense, cloud app visibility, etc. Different departments or roles might have different needs.
- Compare costs for each approach: Calculate the per-user cost of adding the specific standalone licenses you require versus the per-user cost of the E5 Security bundle. Project this over your user count to see annual spending.
- Factor in volume discounts: Ask Microsoft or your reseller about pricing. You may get a better E5 Security price at EA renewal time, especially if you bundle it with other upgrades.
- Decide per user or group: Not everyone needs the same licenses. For example, allocate the bundle to high-risk groups (such as IT admins and executives) and utilize cheaper standalone add-ons for low-risk users.
- Plan deployment and adoption: Don’t buy what you can’t roll out. Have a clear plan (and the necessary resources) to deploy each advanced tool so that you can realize its full value. If you can’t use a feature soon, consider waiting before licensing it.
FAQ: Microsoft Security Bundle vs Standalone
Q1: Is the E5 Security bundle included in Microsoft 365 E5?
A1: Yes. Microsoft 365 E5 includes all those security features by default. The E5 Security add-on is specifically for E3 customers who want E5-level security without purchasing the full E5 suite.
Q2: Can I mix E5 Security bundles and standalone licenses for different users?
A2: Yes. You can assign the E5 Security bundle to some users and use individual licenses for others. Mixing bundles and standalones optimizes costs — give full coverage to high-need users, and assign cheaper standalones to users with simpler needs.
Q3: Which is cheaper, EMS E5 or the M365 E5 Security add-on?
A3: EMS E5 is a bit cheaper per user, but it lacks advanced email threat protection. The M365 E5 Security add-on includes that missing piece, so if you need email security too, the E5 Security bundle becomes the more cost-effective choice.
Q4: Will Microsoft offer discounts on the E5 Security bundle?
A4: Yes, especially for large deals or renewals. Microsoft often provides discounts on the E5 Security bundle as part of Enterprise Agreement negotiations. It’s worth asking for a better price if you’re considering the bundle.
Q5: If I only need Microsoft Defender for Endpoint, should I get the bundle?
A5: No. If you only need one product like Defender for Endpoint, it’s cheaper to buy that alone. The E5 Security bundle is worthwhile only when you need multiple tools. For a single-product scenario, stick with the standalone license to avoid paying for unused extras.
Q6: Does the E5 Security add-on include Intune?
A6: Yes. Intune is included (the E5 Security bundle incorporates the EMS E5 suite). If you have M365 E3, you already have Intune; the add-on upgrades you to EMS E5 level, along with all the advanced security features.
Q7: Can I downgrade from the E5 Security bundle to standalone licenses mid-term?
A7: No. You generally can’t drop the bundle mid-term. It’s a commitment for the contract period (annual term or EA). You typically must wait until your next renewal to downgrade to standalone licenses.
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