How to save on Microsoft 365 licensing in 2026: 8 checks before you renew

1. Cancel add-ons that are now included

Since July 2026:

Office 365 E3 and Microsoft 365 E3 include Defender for Office 365 Plan 1.
Microsoft 365 E3 and EMS E3 include Intune Plan 2, Remote Help and Advanced Analytics.
Microsoft 365 E5 also includes Intune Endpoint Privilege Management, Microsoft Cloud PKI and Intune Enterprise Application Management.

If you bought any of these as an add-on, don’t renew it. Check the timing too: Microsoft finished adding these capabilities to the plans by 1 August 2026.

2. Find licenses nobody uses

Leavers, duplicate accounts and licenses assigned "just in case". Usage reports in the Microsoft 365 admin center and sign-in data in Entra ID show who hasn’t signed in for months. Reassign those licenses, or reduce the count at renewal.

3. Match the plan to each employee’s work

Frontline workers: the F1 ($3) and F3 ($10) plans are built for them, instead of E3 or Business Premium.
Users who need one app, such as Power BI or Project: sometimes a dedicated license is enough, without a full suite.
Contractors without a company device: they don’t always need device management. If you only need to protect data inside apps, plan for that need.

4. Mix Business Premium with Enterprise

An organization past 300 users doesn’t have to move everyone to E3. Keep up to 300 users on Business Premium ($22) and give E3 ($39) only to the rest.

5. Terminal servers don’t require E3

Business Premium is the only Business plan that supports shared computer activation, so you can run Office on a terminal server or Remote Desktop with it. You don’t need to upgrade to E3 for that alone.

6. Monthly or annual terms

Option	What it means	Price
Monthly term, no commitment	Reduce or cancel at the end of any month	About 20% more than an annual term
Annual term, billed monthly	Commit for a year, pay each month	5% more than paying upfront (since April 2025)
Annual term, paid upfront	Commit for a year, pay once	The lowest price

The big gap is between monthly and annual terms, not between paying monthly or upfront. If your headcount is stable, put most licenses on an annual commitment. Keep only the part that really changes on monthly terms, such as temporary or seasonal staff. Check exact prices with your provider, as they vary by plan.

7. Time your renewal

A price change applies only at renewal, transition or a new purchase, not mid-term. Microsoft 365 E3 and E5 also offer a three-year term that locks the price for the whole period.

8. Map the tools you pay for twice

Antivirus, email filtering or device management from another vendor, when the same capability is already in your Microsoft licensing. Note each tool’s cost and renewal date, and time the switch so you never pay twice.

At OnCloud we review your licensing with you before renewal: what’s already included, what you can drop, and which mix of plans fits you. Want to see how much you can save?