Negotiating Microsoft Security Products
Introduction: Why Microsoft Security Negotiations Are Different
Microsoft is aggressively expanding its cybersecurity business. Security has become a major revenue pillar for the company, with ambitious growth targets. Their initial quotes for Microsoft security products often leave plenty of room for negotiation.
Microsoft is also keen to replace third-party security tools by promoting its Defender and Entra (Azure AD) solutions. This competitive drive means sales teams have the flexibility and motivation to strike better deals during negotiations.
Enterprises bundling multiple Microsoft security tools can unlock bigger enterprise discounts. Microsoft’s account teams have more flexibility when customers adopt the full Defender and Sentinel suite instead of a single-point solution. Read our overview for Microsoft Security Solutions Licensing.
Always assume Microsoft’s first offer is not its best. A skeptical and strategic negotiation stance can uncover hidden concessions. Savvy CIOs and CISOs use bundling and competition as leverage to drive down costs.
With the right tactics, you can secure a Microsoft security deal well below the initial quote. It’s not uncommon to achieve 20% or more off list prices through savvy negotiation.
E5 Security Add-On: Bundle Pricing vs Standalone Licenses
The Microsoft 365 E5 Security add-on bundles advanced security tools under one license. It’s designed for organizations on E3 plans that need E5-level security capabilities without paying for the full E5 suite.
This security bundle typically costs around $12 to $15 per user per month. That single price includes multiple solutions that would cost far more if bought separately.
Included in an E5 Security bundle are:
- Azure AD Premium P2 (Entra ID P2 for identity management)
- Microsoft Defender for Endpoint (endpoint detection and response)
- Microsoft Defender for Office 365 (email and collaboration threat protection)
- Microsoft Defender for Cloud Apps (Cloud App Security for SaaS apps)
- Microsoft Defender for Identity (identity threat detection for on-prem AD)
Buying these individually could exceed $25+ per user in total. The E5 Security add-on offers one bundled price, so it’s highly cost-effective if you need two or more of these tools.
For example, Azure AD Premium P2 costs around $6 and Defender for Endpoint costs about $5 per user. Needing both puts you near the bundle’s price.
Add Defender for Office 365 or Cloud App Security, and standalone licensing will exceed the $12 cost.
If you only require one specific security product, a standalone license might be cheaper. But once your needs span multiple areas (endpoint, email, identity, cloud apps), the E5 Security bundle delivers better value and simpler licensing.
Note: Microsoft 365 E5 Security is essentially the EMS E5 package plus Office 365 security features. It provides the full Microsoft security suite, but without the compliance add-ons found in the full E5 license.
Optimize your entitlements, Maximizing Value from Microsoft Security Licenses: Use What You Already Own.
Scenario 1: Negotiating an E5 Security Upgrade
Consider an enterprise upgrading from E3 to the E5 Security add-on. Microsoft often provides promotional first-year pricing to encourage this move. Push for a steep introductory discount in year one to lower the cost of adoption.
Leverage any upcoming third-party security renewals as bargaining chips. If your CrowdStrike endpoint or Splunk SIEM contracts are due, let Microsoft know. They are eager to displace competitors and may drop the E5 Security price to win your business.
Use competitive comparisons in your negotiation. For example, if you currently pay $X per user for another vendor’s tools, challenge Microsoft to beat that with the E5 Security bundle.
Microsoft’s goal is to get you onto their platform, so they often have room to undercut rival pricing.
In successful negotiations, enterprises have secured extras, such as extended pilot periods or deployment assistance. Do not just settle for a price cut — also ask for free trial seats (3–6 months) or Microsoft-funded onboarding services to sweeten the deal.
Scenario 2: High-Volume Standalone Defender or Security Tools
Not every organization needs the full bundle. Some may only want a specific solution, such as Microsoft Defender for Endpoint, for 20,000+ devices. At that scale, the default list price isn’t set in stone — huge volumes give you leverage.
Press for volume-based discounts beyond standard pricing tiers. If you’re ordering tens of thousands of Defender for Endpoint licenses, negotiate an enterprise discount on the per-user price. Microsoft can afford to lower the rate when you bring significant seat counts.
Use competitive takeouts to your advantage. If you’re replacing a rival solution (like swapping out CrowdStrike for Defender), highlight this in talks. Microsoft often offers extra discounts or flexible terms to secure wins against competitors.
Also request value-adds along with price. For large deals, ask for an extended trial or additional support. Microsoft might agree to an extended pilot period or include training credits when you commit to a high-volume purchase.
Bundling Microsoft Security with Enterprise Agreements
Your Enterprise Agreement (EA) renewal is a prime opportunity to add security products on favorable terms. Bundling Microsoft Defender or the E5 Security suite into an EA can yield significant savings and simplified management.
During your Microsoft EA security negotiation, propose adding the new security licenses at a discounted rate. Microsoft wants to increase your commitment, so they often agree to lower unit costs if you fold these products into a multi-year agreement.
Ask for free trial periods or deferred charges within the EA for new security tools. For example, negotiate to start paying for Defender or E5 Security only after a 3-month pilot included in the EA.
Multi-year commitments should be accompanied by price locks or deeper discounts. For example, aim for something like “20% off Microsoft Defender for Endpoint if added to the EA renewal for the next three years.”
Bundling into the EA creates a win-win: you get a better price, and Microsoft secures a longer-term commitment.
Leveraging Microsoft Security Adoption Programs
Beyond pricing, tap into Microsoft’s own adoption incentives.
Microsoft account teams often have funding programs to help customers deploy and use security products successfully. Microsoft also occasionally runs time-limited security adoption offers. Ask if any current promotion can further reduce your cost.
Take advantage of FastTrack services if you’re eligible. FastTrack provides no-cost remote assistance for deploying Microsoft 365 security features to drive user adoption.
Microsoft also funds specialized security workshops and pilot programs. Ask your account rep about any available funded engagements or proof-of-concept offers.
Bring up any available adoption funds during negotiation. Microsoft sometimes provides training vouchers, partner consulting hours, or even free licensing periods to encourage use of new security products. These account team incentives can significantly reduce your out-of-pocket costs.
If you plan to adopt Microsoft Sentinel for SIEM, negotiate Azure credits to offset its consumption cost. Sentinel isn’t part of E5 Security and runs on Azure usage.
However, you can request a chunk of Azure credit or a discounted rate as an incentive to start using Sentinel. Microsoft is often willing to subsidize initial SIEM costs to get you on board.
Microsoft’s security roadmap (for example, new AI-powered tools like Security Copilot) gives them an extra motive to drive adoption. Early adopters of these innovations can sometimes negotiate special incentives or funding support.
The bottom line: ensure Microsoft invests in your success. Every extra workshop, support engagement, or credit they fund is value-added to your deal, on top of pure license discounts.
Comparison Table – E5 Security vs Standalone vs Third-Party
| Option | What’s Included | Cost (approx.) | Best For | Negotiation Angle |
|---|---|---|---|---|
| E5 Security Add-On | Full Defender suite + Azure AD P2 (bundle) | $12–15/user/month | Orgs needing multiple tools | Bundle discount |
| Standalone Tools | Individual Defender or Azure AD licenses | $5–8 each | Orgs needing 1–2 specific tools | Volume discount |
| Third-Party Tools | CrowdStrike, Netskope, Splunk (non-Microsoft) | Higher per tool | Specialist use cases | Competitive leverage |
Checklist: Must-Have Security Negotiation Levers
- First-year promotional discounts
- Bundle Defender/E5 Security into the EA renewal
- Volume-based price breaks for 10k+ users
- Azure credits for a Microsoft Sentinel pilot
- Free trial seats (3–6 months) for new tools
- Microsoft-funded training or workshops for rollout
FAQ: Microsoft Security Product Negotiation
Q1: Can I negotiate the Defender for Endpoint price?
A1: Yes, large volumes or competitive displacement deals usually secure discounts.
Q2: Is Sentinel included in E5 Security?
A2: No, Sentinel is consumption-based, but you can negotiate Azure credits.
Q3: Can E5 Security add-on price be discounted?
A3: Yes, especially if bundled into an EA renewal or when replacing a third-party tool.
Q4: Are Microsoft security bundles cheaper than standalone?
A4: Usually, if you need 2+ major components, bundles are more cost-effective.
Q5: Can Microsoft fund adoption or training?
A5: Yes, through FastTrack services and account team–funded security programs.
Q6: Do E5 customers get Sentinel for free?
A6: No, but incentives like Azure credits can subsidize the usage.
Q7: Is there a best time of year to negotiate with Microsoft?
A7: Yes. Microsoft sales reps are often most flexible near the end of their fiscal year (June 30) or quarter-end, when they need to hit targets.
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