After Microsoft's July 2026 licensing updates take effect, capabilities that previously required add-ons may be included in your base plan.
Without reviewing what changed, you could end up paying for coverage your license already provides. Knowing what your plan now includes at renewal is the best way to avoid overpaying for capabilities you already have or missing new ones that are now part of your baseline.
The most significant change is the integration of Microsoft Defender for Office 365 Plan 1 directly into Office 365 E3 and Microsoft 365 E3. This brings anti-phishing, Safe Links, and Safe Attachments protections into the E3 baseline without requiring a separate add-on. This is one of the most impactful changes for E3 customers who previously purchased Defender for Office 365 Plan 1 as a standalone add-on.
Lower-tier plans including Business Basic, Business Standard, and Office 365 E1 also receive URL link-checking protections across Outlook and Office applications. This tightens the baseline security stack across all tiers.
Microsoft is also introducing Copilot Chat across all Microsoft 365 plans as part of this update. This adds AI-assisted chat in Word, Excel, PowerPoint, Outlook, and OneNote, though it is separate from the full Microsoft 365 Copilot license.
E3 is gaining several Intune capabilities that were previously sold as add-ons or reserved for higher tiers:
If your environment currently licenses any of these separately, your renewal is a good time to audit whether those costs can be removed.
Business Basic, Business Standard, and Business Premium will all receive 100 GB primary mailboxes as part of Microsoft's 2026 packaging updates. These changes begin rolling out in June 2026 and will be complete by August 1, 2026.
The 50 GB mailbox limit on Business plans was one of the most common reasons organizations upgraded to Office 365 E3 for mailbox-heavy users. With that constraint removed, organizations have more flexibility to stay on their current plan without sacrificing storage.
Most Microsoft 365 plans are seeing a price increase at renewal on or after July 1, 2026. The increases vary by plan, but they align with the security, storage, and management features being added to each tier.
|
Plan |
Previous Price |
New Price |
|
Microsoft 365 E3 |
$36 |
$39 |
|
Office 365 E3 |
$23 |
$26 |
|
Business Basic |
$6 |
$7 |
|
Business Standard |
$12.50 |
$14 |
|
Business Premium |
$22 |
$22 |
Business Premium holding at $22 while gaining 100 GB mailboxes makes it a particularly strong value for organizations under 300 users heading into renewal.
These packaging changes create an opportunity to clean up licensing before you lock into a new term. A few things worth reviewing before renewal:
Audit your Defender add-ons
If your E3 environment currently pays for Defender for Office 365 Plan 1 as a standalone add-on, that capability is now included. Confirm whether your add-on can be removed or whether it covers Plan 2 features you still need.
Audit your Intune add-ons
E3 now includes Intune Plan 2, Remote Help, and Advanced Analytics. If you are licensing any of these separately, check whether those subscriptions are still necessary.
Check your mailbox situation
If your organization is on a Business plan and previously upgraded users to E3 specifically for the 50 GB to 100 GB mailbox jump, the 100 GB upgrade may eliminate that need.
July 2026 is a good time to step back and look at the full picture.
Microsoft's July 2026 updates add real value to Business Premium and E3, but they also change what you are paying for at renewal. Taking the time to audit your add-ons, review your mailbox needs, and understand what your plan now includes can prevent unnecessary spend. It also ensures your environment is getting the full benefit of what is already licensed.
If you want help reviewing your licensing before renewal, the Sourcepass Center of Excellence for Microsoft can help. Our team works through these decisions every day and evaluates options based on your actual environment.
More Microsoft 365 Licensing Resources:
How to Choose Between Microsoft 365 Business Premium and E3: A detailed comparison of where Business Premium ends and E3 begins, including how Defender and Purview suites change the decision.
Microsoft Purview Suite for Data Governance in Microsoft 365: What Purview Suite includes, how it is licensed for E3 and Business Premium, and where it replaces standalone compliance tools.
Demystifying Microsoft Podcast - How to Choose Between Business Premium, E3, and E5: A breakdown of the licensing decisions organizations face at renewal, including when E5 is necessary and when add-ons provide the same coverage at lower cost.
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