Office 365 Plan E1 vs E3 Which is Right for You : Fast-Track Guide to Choosing the Best Office 365 Plan

Choosing between Office 365 Plan E1 and E3 can feel overwhelming, especially given how similar they may initially appear. However, each plan caters to different business needs, user profiles, and budget considerations. Here’s a deep dive into their key features, pricing, and decision points so you can confidently make the right choice.

Office 365 E1: Primarily designed for organizations that operate mostly online, E1 is the entry-level business plan. It provides web-based Office apps (Word, Excel, PowerPoint, etc.), along with 1 TB of OneDrive storage per user, Exchange email hosting, Teams collaborative tools, and SharePoint for file sharing. However, it does not include the fully installed desktop Office applications. Users access everything through a web browser or mobile app.

Office 365 E3: The E3 plan builds on E1 by adding fully-installed Office applications for PC and Mac, access to additional security features (like legal hold), data loss prevention, and advanced compliance tools. With E3, users get both the online AND desktop versions of Office apps, making it more flexible for power users or those needing advanced productivity tools.

1. Email & Collaboration: Both E1 and E3 offer business-class email, shared calendars, and Teams for communication.
2. Office Applications: E1: Web and mobile only. E3: Full desktop, web, and mobile.
3. Storage: 1 TB OneDrive per user in both plans.
4. Security & Compliance: E3 includes advanced data governance, legal hold, and encryption capabilities; E1 offers the basics.
5. Price: E1 is typically much more affordable than E3, making it an attractive option for businesses with tighter IT budgets who don’t need desktop apps.

As a professional designer and content creator, my decision on tools always comes down to long-term functionality, collaboration, and flexibility. If your team routinely collaborates on large files—such as layouts, mood boards, or even office layout planning projects—E3’s suite of desktop apps and advanced data security features is often worth the extra investment. For businesses relying mainly on cloud-based workflows and standard document editing, E1 covers most essentials efficiently, all while keeping costs low.

Tips 1:

Consider how your team works daily. If you require offline access, complex spreadsheets, or integration with desktop software, E3 is a smart bet. For lightweight, browser-based collaboration, E1 saves costs while still providing robust communication and cloud storage.

FAQ

Q: What’s the main difference between Office 365 E1 and E3?

A: E1 offers web-only Office apps, while E3 includes both web and full desktop versions, plus advanced security features.

Q: Do both plans include Microsoft Teams and OneDrive?

A: Yes, both E1 and E3 provide Teams for collaboration and 1 TB of OneDrive storage per user.

Q: Is Office 365 E3 better for design teams?

A: E3 offers full desktop apps and more advanced file handling, making it preferable for design or architecture teams needing robust tools.

Q: Can I upgrade from E1 to E3 later?

A: Yes, you can upgrade your users from E1 to E3 at any time through your Microsoft admin portal.

Q: Which plan supports advanced security and compliance?

A: E3 includes advanced security and compliance features such as legal hold and data loss prevention, which E1 does not provide.