If you’ve been putting off a decision about Microsoft 365 — or wondering whether your current plan is still the right fit — now is a good time to take a fresh look. Microsoft updated its pricing on July 1, 2026, and made meaningful changes to what’s included at each tier. The good news: the overall value has improved, especially for small businesses that need more than just email and Office apps.
There are three plans designed specifically for businesses with up to 300 users: Business Basic, Business Standard, and Business Premium. At first glance they look similar, but the differences — particularly around security — are significant. We’ve put together the detailed comparison table below, followed by a plain-English summary of who each plan is best suited for.
All prices shown are per user / per month on a month-to-month (monthly commitment) basis, reflecting July 1, 2026 list pricing.
Annual commitment pricing runs approximately 20% lower.
| Feature |
Business Basic Web & cloud essentials $8.40 per user / month $7.00 / mo on annual |
Business Standard Full desktop apps + collaboration $16.80 per user / month $14.00 / mo on annual |
Business Premium Full suite + enterprise security $26.40 per user / month $22.00 / mo on annual |
|---|---|---|---|
| 📦 Apps & Desktop Software | |||
|
Desktop Office Apps Installable Word, Excel, PowerPoint, Outlook, OneNote on up to 5 PCs/Macs + 5 tablets + 5 phones per user |
✗Web & mobile only | ✔ | ✔ |
|
Web & Mobile Office Apps Browser and phone/tablet versions of Word, Excel, PowerPoint, Outlook |
✔ | ✔ | ✔ |
|
Publisher & Access (PC) Desktop publishing and database apps (Windows only; Publisher retiring Oct 2026) |
✗ | ✔ | ✔ |
|
Clipchamp Video Editor Browser-based video creation and editing tool |
Web version | ✔ | ✔ |
| 📧 Email & Communication | |||
|
Business Email (Custom Domain) Professional email @yourdomain.com hosted on Exchange Online |
✔ | ✔ | ✔ |
|
Mailbox Storage Per-user Exchange Online mailbox size |
50 GB | 50 GB | 100 GB |
|
Microsoft Teams Chat, video meetings, voice calls, and team workspaces |
✔ | ✔ | ✔ |
|
Meeting Recordings & Transcription Record Teams meetings to the cloud; auto-generate transcripts |
✔ | ✔ | ✔ |
|
Microsoft Bookings Online appointment scheduling page for clients; calendar integration |
✔ | ✔ | ✔ |
| ☁️ Cloud Storage & Collaboration | |||
|
OneDrive Cloud Storage Per-user file storage, sync, and sharing |
1 TB | 1 TB | 1 TB |
|
SharePoint Online Team intranet sites, document libraries, company-wide file sharing |
✔ | ✔ | ✔ |
|
Forms, Planner & To Do Survey/quiz builder, task management, and personal to-do lists |
✔ | ✔ | ✔ |
| 🤖 AI Features (Copilot) | |||
|
Microsoft 365 Copilot Chat AI chat assistant with inbox & calendar awareness; Word/Excel/PowerPoint agents (as of mid-2026) |
✔ | ✔ | ✔ |
|
Full Microsoft 365 Copilot (Advanced AI) Deep AI integration across all apps, advanced Copilot experiences |
Add-on: +$30/user/mo | Add-on: +$30/user/mo | Add-on: +$30/user/mo |
| 🔒 Security & Compliance | |||
|
Exchange Online Protection Anti-spam, anti-malware email filtering for all inbound/outbound mail |
✔ | ✔ | ✔ |
|
URL / Safe Link Checks Real-time scanning of clicked links in email and Office apps for malicious sites |
Basic URL checks (mid-2026 addition) |
Basic URL checks (mid-2026 addition) |
✔Safe Links + Safe Attachments (Defender for Office 365 Plan 1) |
|
Microsoft Defender for Business Endpoint detection & response (EDR), ransomware protection, automated threat response for all devices (Windows, Mac, iOS, Android) |
✗ | ✗ | ✔ |
|
Microsoft Intune (Device Management) MDM/MAM: enforce device policies, remote wipe, push apps, manage BYOD and company devices from a single dashboard |
✗ | ✗ | ✔ |
|
Entra ID P1 / Conditional Access Require MFA only from untrusted networks, block risky sign-ins, enforce access policies by location or device compliance |
Basic MFA only | Basic MFA only | ✔ |
|
Data Loss Prevention (DLP) & Sensitivity Labels Prevent sharing of sensitive data (SSNs, credit cards, health records) via email/Teams/SharePoint; classify and encrypt documents |
✗ | ✗ | ✔ |
| ⚙️ Administration & Scale | |||
|
Microsoft 365 Admin Center Centralized portal to manage users, licenses, security settings, and devices |
✔ | ✔ | ✔ |
|
Multi-Factor Authentication (MFA) Required for cyber insurance compliance; all plans include basic MFA; Premium adds policy-driven conditional access |
✔Basic | ✔Basic | ✔Advanced (Conditional Access) |
Pricing notes: All prices are per user/month on a monthly commitment (no annual contract required; cancel anytime) effective July 1, 2026.
Annual commitment pricing is approximately 20% lower: Basic $7.00 · Standard $14.00 · Premium $22.00.
Defender for Business (~$3/user/mo) + Intune (~$8/user/mo) purchased separately would cost ~$11/user/mo — meaning Premium’s security stack effectively pays for itself vs. Standard + add-ons.
Organizations larger than 300 users should evaluate Microsoft 365 Enterprise plans.
Sources: Microsoft 365 Plans & Pricing ·
Microsoft 365 Blog – Pricing Update (Dec 2025).
Prepared by Katy Computer Systems, Inc. — St. Louis, MO.
So Which Plan Is Right for Your Business?
Here’s how we think about it when working with our clients in the St. Louis area:
A good fit if your team works almost entirely in a browser — no need for installed Word or Excel on a PC. Think businesses where staff primarily use web-based tools, or where computers are shared and managed centrally. It covers email, Teams, OneDrive, and SharePoint at the lowest price point. If you need desktop Office apps, this plan isn’t enough.
The right choice if your team needs full desktop Office applications (Word, Excel, PowerPoint, Outlook installed on their computers) and your security posture is simple. Standard is a solid productivity platform. It does not include endpoint protection for devices, advanced email threat defense, or device management — so if those matter to you, read on.
Our most commonly recommended plan for small businesses in 2026. It includes everything in Standard, plus Microsoft Defender for Business (endpoint protection for all your PCs, Macs, and phones), Intune device management, advanced email threat defense, and conditional access policies. The security tools bundled in Premium would cost roughly $11/user/mo to purchase separately — so the $9.60 premium over Standard effectively pays for itself. It’s also the plan most likely to satisfy your cyber insurance requirements.
A Note on the July 2026 Price Changes
Microsoft raised prices on Basic and Standard on July 1, 2026 — Basic went up about 17% and Standard about 12% on a monthly commitment. Business Premium was not changed. That narrowing of the gap between Standard and Premium makes the upgrade decision easier than it used to be. If you’re currently on Standard and renewing, it’s worth having a conversation about whether the additional $9.60/user/month for Premium’s security stack makes sense for your business.
Monthly vs. Annual Commitment: What You’ll Actually Pay
All prices in the comparison table above reflect month-to-month billing with no annual contract. If you’re willing to commit to a 12-month term, Microsoft offers approximately 20% off — and that discount applies to all three plans. Here’s how the numbers compare:
For a 10-user business on Business Premium, the difference between monthly and annual billing is $528 per year. At 25 users that’s $1,320, and at 50 users $2,640 — simply by committing to a 12-month term. If your headcount is stable, annual billing is almost always the right call. If you’re growing quickly or unsure of your needs, monthly gives you the flexibility to add or remove seats without penalty.
Need Help Deciding?
Microsoft 365 licensing isn’t always straightforward, especially when you factor in existing subscriptions, security requirements, and cyber insurance obligations. Katy Computer Systems helps St. Louis area businesses evaluate, deploy, and manage Microsoft 365 — from initial license selection through ongoing administration and support.
We’ll review your current setup, discuss your security and compliance needs, and give you a straightforward recommendation — no sales pressure, just honest guidance from a local team that knows your environment.
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