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What Are the Limitations of Microsoft 365 E3 Compared to E5?

Q and A With Medha Cloud

Microsoft 365 E3 lacks the advanced security, analytics, and telephony features that are included in the E5 plan. Microsoft 365 E5 is designed for organizations needing the highest level of threat protection, compliance, and communication tools.


Key Limitations of Microsoft 365 E3 Compared to E5

Microsoft 365 E3 is a robust enterprise plan, but it has notable limitations when compared to E5. Here are the primary differences:


1. Advanced Security Features

E3 provides essential security tools but lacks the full spectrum of advanced security available in E5.

FeatureE3E5
Microsoft Defender for Office 365Plan 1 (basic threat protection)Plan 2 (advanced threat detection)
Microsoft Defender for EndpointNot includedIncluded
Insider Risk ManagementNot includedIncluded
Advanced Threat Analytics (ATA)Not includedIncluded

E5 offers tools like Microsoft Defender for Endpoint, which provides endpoint detection and response (EDR), and Insider Risk Management, helping mitigate insider threats.


2. Analytics and Insights

E3 includes basic reporting tools, while E5 delivers advanced analytics.

FeatureE3E5
Power BINot includedPower BI Pro included
Workplace AnalyticsNot includedIncluded
Advanced Usage AnalyticsLimitedComprehensive

Power BI Pro in E5 allows businesses to create and share powerful data visualizations and insights. E3 lacks this feature entirely.


3. Telephony and Unified Communications

E3’s communication tools focus on standard Teams functionality, whereas E5 includes enterprise-grade telephony and voice solutions.

FeatureE3E5
Microsoft Teams FeaturesStandardAdvanced
Teams Phone with Calling PlanNot includedIncluded
PSTN CallingNot includedIncluded

E5 enables Teams Phone with Calling Plan, replacing traditional phone systems with cloud-based telephony.


4. Compliance and Governance

While E3 includes compliance basics, E5 offers tools to meet stringent regulatory requirements.

FeatureE3E5
Advanced eDiscoveryLimitedComprehensive
Customer LockboxNot includedIncluded
Communication ComplianceNot includedIncluded

Organizations requiring advanced eDiscovery and communication compliance tools may find E3 insufficient.


Who Should Choose Microsoft 365 E3 Over E5?

  • Choose E3 if your organization needs a cost-effective plan with strong productivity tools, basic security, and compliance features.
  • Choose E5 if you require advanced threat protection, data analytics, cloud telephony, and premium compliance tools.

Conclusion

While Microsoft 365 E3 meets the needs of most enterprises, it lacks the advanced security, analytics, and telephony features available in E5. For businesses with sophisticated IT and regulatory requirements, E5 provides a more comprehensive solution.


Need help deciding between E3 and E5?

Medha Cloud will help you assess your business needs and implement the right Microsoft 365 plan.

Benjamin Gbolaru
Benjamin Gbolaru
I'm Benjamin, a Microsoft 365 Specialist, helping small and large businesses deploy, configure, and secure M365 environments to maximize the benefits of Microsoft tools. With sound expertise in driving cloud adoption, identity and access management (IAM), security monitoring, system reliability, and proactive troubleshooting.
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