Microsoft 365 Business Basic vs Standard vs Premium: which to pick

Microsoft 365 Business Basic vs Standard comes down to the desktop apps: Basic gives you business email, Teams, and web and mobile Office apps, and Standard adds the desktop versions. Premium adds advanced security and device management on top of Standard.

Most offices pick by what each person does all day. People who only need email, chat and shared files can use Basic. People who work in Word and Excel all day need Standard. Premium fits offices that hold sensitive data or need to control company laptops.

Here are the prices. These are Microsoft's US list prices per user per month, paid yearly. We read them on Microsoft's compare page and its Basic, Standard and Premium plan pages on October 26, 2026.

• Business Basic: $7.00
• Business Standard: $14.00
• Business Premium: $22.00

Microsoft raised two of these prices on July 1, 2026, according to its licensing update. Basic went up from $6.00 to $7.00. Standard went up from $12.50 to $14.00. Premium stayed at $22.00. Our post on the July 2026 Microsoft 365 price changes explains what changed.

What every plan includes

All three plans share the same base. Each one covers 1 to 300 users. Each one includes:

• Business email on your own domain, with a 100 GB mailbox
• Spam and malware filtering for email
• 1 TB of OneDrive storage per user
• Teams chat, calls and meetings, in the versions sold with Teams
• Word, Excel, PowerPoint and OneNote in a web browser and on phones
• SharePoint for shared files and team sites
• Forms, Planner, Lists and To Do, plus Bookings and Shifts in the versions with Teams
• Copilot Chat, Microsoft's AI chat tool
• Multifactor authentication and single sign-on

Every plan also comes with a financially backed 99.9% uptime guarantee.

Sign-in protection comes with every plan

Multifactor authentication (MFA) asks for a second proof when someone signs in. That proof is often a code or a tap on a phone. Microsoft's security overview says MFA is on by default through a setting called security defaults. Keep MFA on for everyone. Microsoft's Digital Defense Report 2025 says "MFA can block over 99% of identity-based attacks."

Copilot Chat is not Microsoft 365 Copilot

Every plan includes Copilot Chat. Microsoft says it "doesn't integrate with Microsoft 365 apps or organizational content such as files, emails, or chats." Copilot inside your apps and files is Microsoft 365 Copilot, a separate paid product. Existing customers can add it from $18.00 per user per month, paid yearly, per Microsoft's Copilot pricing page. That is a first-year discount from $21.00, offered through December 31, 2026. New customers buy it as part of a bundle instead.

One more thing to watch. The main columns on Microsoft's compare page show Standard with Copilot ($23.50) and Premium with Copilot ($32.00). Those are bundles. The plain plans cost less and do not include Copilot in the apps.

Business Basic: email, Teams and web apps

Basic is for people who work in a browser or on a phone. Microsoft lists its devices as "Web and mobile apps only." There are no desktop Office apps.

Basic fits roles like these:

• Front desk staff who mostly answer email
• Field workers who check Teams on a phone
• Part-time staff who open shared files now and then

Basic has some limits. The email archive holds 50 GB. It uses the free version of Microsoft Entra ID, the sign-in system. Its extra email protection is limited to checking links when someone clicks them. It also leaves out Clipchamp, Loop workspaces and webinar hosting.

If someone needs desktop Excel or Word, Basic is the wrong fit.

Business Standard: what it adds

Standard adds the desktop apps. Each user gets desktop Word, Excel, PowerPoint and OneNote. Access is included too, for PCs only. Each user can install the apps on up to 5 PCs or Macs, 5 tablets and 5 phones.

Standard also adds:

• Loop workspaces
• Clipchamp for simple video editing
• Webinar hosting with sign-up forms and attendee reports (versions with Teams)

Standard does not add security. It has the same 50 GB archive as Basic. It uses the same free Entra ID. It has the same link-click email protection. Standard is a work-tools upgrade, not a security upgrade.

Business Premium: what it adds

Microsoft says Premium "includes all the same apps and services plus advanced cyberthreat protection and device management capabilities." In plain terms, Premium is Standard with stronger locks.

Premium adds:

• Intune Plan 1 to manage and secure company laptops and phones
• Entra ID P1, which includes Conditional Access, per Microsoft's security overview. Conditional Access sets rules for when and how people can sign in.
• Defender for Business, which Microsoft describes as "AI-powered device protection from ransomware and malware"
• Defender for Office 365 Plan 1 for fuller email protection
• Purview Data Loss Prevention for emails and files
• Purview Information Protection Plan 1 to find and protect sensitive data
• Windows Hello for Business, a secure way to sign in to devices, and a Windows 11 Pro upgrade
• A 1.5 TB email archive, up from 50 GB

Ransomware is a real risk for small offices. Verizon's 2025 DBIR SMB snapshot found ransomware in 88% of breaches at small and midsize businesses, which it defines as fewer than 1,000 employees. At larger organizations, the figure was 39%.

How to choose for your office

These are our recommendations for an office of 3 to 50 people.

1. Start with each person's work. Ask who needs the desktop apps. Put them on Standard. Put everyone else on Basic.
2. Pick Premium for security, not apps. Premium makes sense when laptops leave the office or you keep client records. It also fits when you need to manage the devices people use for work.
3. Don't buy Standard for safety. Basic and Standard have the same security. If you need device control, the step is Premium.
4. Mix plans when it fits. Microsoft lets you mix business plans, up to 300 seats in total across the family. Microsoft's Business Premium FAQ says not everyone needs Premium. Its benefits apply "only to users with devices managed with a Business Premium subscription."
5. Review at renewal. Existing customers see the new July 2026 prices at their next renewal. That is a good time to check who still needs which plan.

Here is a made-up example. A 12-person office has 2 front desk staff, 7 staff who write reports, and 3 managers who take laptops home with client files. The front desk could use Basic, the report writers Standard, and the managers Premium. At Microsoft's yearly list prices, that mix is $178 a month. Putting all 12 people on Premium would be $264 a month. The trade-off is that the other 9 people's devices don't get Premium's device protection.

Annual vs monthly billing

The prices above are for plans paid yearly. Yearly plans renew on their own. A monthly subscription costs more per user per month:

• Business Basic: $8.40
• Business Standard: $16.80
• Business Premium: $26.40

By our math, that is 20% more than the yearly price on each plan. Microsoft offers three terms: a monthly commitment paid monthly, an annual commitment paid monthly, and an annual commitment paid upfront. Monthly costs more, but it comes without a year-long commitment. If your team size is steady, we suggest the yearly price.

If you are weighing these plans, contact us and tell us how your office works. We can help sort out who needs desktop apps and whose devices need Premium. Our Microsoft 365 and Google Workspace page lists what we handle: licensing on the Xtego bill, setup and migration, security hardening and license optimization.