Updated and refreshed July 30, 2025.
Upgrading Microsoft enterprise licenses from E3 to E5 or from Entra ID Plan 1 to Plan 2? Whether your company is making the move or evaluating it, the key question is: How do you turn licensing changes into real security gains?
Platformizing remains a major trend in 2025, and Microsoft often sits at the center of these efforts due to its broad security capabilities. But maximizing value from E3 and E5 licenses requires time, expertise, and contextual understanding of your environment.
While E3 offers a strong foundation, E5 provides advanced features designed to address more sophisticated threats. The challenge lies in understanding the tangible impact these features could have on reducing risk and how to measure it.
A Practical Approach: Start with Current Capabilities
A smart first step is assessing your existing Microsoft tools. Understanding what you're already licensed for and what’s actually being used can surface security gaps and highlight where upgrades may be warranted.
This is especially important for organizations using a hybrid E3/E5 model. Each license includes powerful features, but deploying them effectively requires knowing your environment and tailoring policies accordingly.
For example, you might choose to assign E5 licenses to users who are disproportionately targeted by phishing or account compromise attempts. But you can only make decisions like that if you have visibility into the full picture including threat telemetry, user behavior, and configuration status.
Reach helps organizations do exactly that by surfacing risk-based insights on how specific license features can be used to mitigate threats making upgrade decisions clearer and more defensible.
Understand the Value of What You Own
Whether you're on Entra ID Plan 1 (E3) or Plan 2 (E5), understanding how capabilities map to real risks is key.
For example:
- Plan 1 includes features like User Actions and baseline Conditional Access.
- Plan 2 introduces risk-based Conditional Access policies, like Sign-in Risk or User Risk, which can adapt in real time to changing threat signals.
With Reach, teams can analyze how features in each license can be applied in Conditional Access policies to reduce risk such as shortening session duration for high-risk users based on live signals.
Using Data to Drive E5 Upgrade Decisions
For organizations considering a move to E5, the question isn’t just what features E5 includes, it’s which of those features would actually reduce risk in your environment.
Reach helps answer that by:
- Ingesting data from your environment to understand active threats
- Assessing your current control coverage and configuration
- Showing how specific E5 features like Threat Explorer or risk-based access controls would apply to the exposures you’re facing
Reach also provides curated policies to show how advanced features like Sign-in Risk could be applied to mitigate threats, such as reducing access duration for users who are actively being targeted.
This gives security leaders a clearer understanding of how an upgrade will improve protection before making the investment.
Conclusion: Reach Empowers Data-Driven Security Decisions
Choosing between Microsoft E3 and E5 is a strategic decision. Both offer powerful capabilities, but knowing which features are relevant to your unique threat landscape requires data and context.
Reach helps organizations:
- Evaluate whether an E5 upgrade is justified
- Deploy E5 features more effectively
- Maximize the value of their Microsoft stack—no matter the license mix
With Reach, you can close the gap between what your tools offer and what you're actually using ensuring every licensing decision improves real-world protection.
Lear more at https://www.reach.security/microsoft-e3-e5-security-optimization
FAQs: Microsoft E3 vs. E5 for Security
What’s the difference between Entra ID Plan 1 (E3) and Plan 2 (E5)?
Plan 1 includes core identity protections and Conditional Access. Plan 2 adds risk-based policies, identity protection, and other advanced capabilities for dynamic threat response.
Do I need to upgrade everyone to E5?
Not necessarily. Many organizations deploy E5 selectively focusing on high-risk users or groups. Tools like Reach help identify where E5 licenses will have the most impact.
How does Reach support Microsoft licensing decisions?
Reach provides data-driven insights that show where your current controls fall short and how advanced Microsoft features could close those gaps.
