Microsoft 365, line by line.
Microsoft 365 is a comprehensive productivity suite including Outlook, Teams, Word, Excel, PowerPoint, SharePoint, OneDrive, and enterprise security features.
✦ The numbers
What it costs, at a glance.
- Productivity
- Per user/month (tiered editions)
- $6/user/month (Business Basic)
- $500-$25,000/month
✦ Cost breakdown
Where Microsoft 365 actually shows up on the invoice.
Per-user math, monthly aggregates, annual projections — the figures we plug into models when sizing typical waste.
$22 / month
Based on the typical plan mix we see across organizations of this size.
$2,640 – $26,400
Ideal for organizations of all sizes, especially enterprises with 50+ employees. Tier choice swings the total dramatically.
✦ Waste patterns
Where companies overspend on Microsoft 365.
The same handful of leaks shows up in almost every audit. Check yours against this list before your next renewal.
- 01
E5 licenses for users who need only email and basic Office apps (E1 or E3 would suffice)
- 02
Licenses for former employees, contractors, or shared accounts that are no longer active
- 03
Paying for desktop Office apps when web-only versions in Business Basic would work
- 04
Unused add-ons like Power BI Pro, Visio, or Project licenses collecting dust
✦ How to fix it
Optimizing Microsoft 365 without breaking workflow.
Practical, sequenced steps. Start at the top — most companies recover the bulk of their savings in the first two.
- 01
Right-size license tiers: assign E1/Business Basic to frontline workers and E3/E5 only where advanced features are needed
- 02
Automate license reclamation when employees leave using Azure AD lifecycle policies
- 03
Audit add-on license usage quarterly and remove subscriptions with low adoption rates
- 04
Negotiate Enterprise Agreements for organizations with 500+ seats for volume discounts
✦ Alternatives
If Microsoft 365 isn't the right fit, here's what else to look at.
Switching costs are usually higher than people expect. Audit usage first — often the cheaper move is to right-size what you already run.
Zoho Workplace
Popular alternative
LibreOffice (self-hosted)
Popular alternative
✦ The complete guide
Optimizing Microsoft 365 costs, in full.
Where Microsoft 365 sits in the market
Productivity tools concentrate active value in a small number of users and waste in everyone else who got an automatic license at onboarding. The dominant pattern is bundle-tier purchasing: a company buys an enterprise tier for the AI feature or the storage allocation, then never tracks who actually uses what they paid extra for. Right-sizing the tier per-user often beats negotiating the bundle.
Dominant enterprise productivity suite; the default choice for organizations standardized on Windows and Active Directory. E5 licenses provisioned organization-wide for security features that only the IT and compliance teams actually consume.
What Microsoft 365 costs
Microsoft 365 is typically priced at $6-57 per user per month across Business Basic, Business Standard, E3, and E5 tiers.. Pricing varies by tier and contract length; the patterns below describe the waste we see most often regardless of which tier a customer is on.
Common waste patterns
- E5 licenses for users who need only email and basic Office apps (E1 or E3 would suffice)
- Licenses for former employees, contractors, or shared accounts that are no longer active
- Paying for desktop Office apps when web-only versions in Business Basic would work
- Unused add-ons like Power BI Pro, Visio, or Project licenses collecting dust
How Efficyon analyzes Microsoft 365 spend
Efficyon ingests your accounting data (Fortnox, QuickBooks, Stripe, Xero) and identity data (Microsoft 365, Google Workspace) and matches activity against billing. For Microsoft 365, that surfaces e5 licenses provisioned organization-wide for security features that only the IT and compliance teams actually consume. The findings appear in your dashboard with the contract month they applied to and the dollar value at stake.
✦ Vendor site
Visit Microsoft 365 directly.
✦ More in Productivity
Adjacent tools worth comparing.
Notion
Notion is an all-in-one workspace combining notes, docs, databases, wikis, and project management into a single flexible tool for teams and individuals.
From Free for individuals · Per user/month (tiered)
Zendesk
Zendesk is a customer support and ticketing platform used by service teams to manage email, chat, and phone interactions with customers across channels.
From $55/agent/month · Per agent/month
Google Workspace
Google Workspace provides cloud-native productivity and collaboration tools including Gmail, Google Drive, Docs, Sheets, Meet, and Chat for business teams.
From $7/user/month · Per user/month (tiered editions)
Dropbox
Dropbox is a cloud storage and file synchronization service that lets teams store, share, and collaborate on files with desktop and mobile sync.
From $15/user/month · Per user/month (tiered)
✦ Get started
Analyze your Microsoft 365 spend. In ten minutes.
Connect Microsoft 365 alongside your accounting and we'll surface every overlap, idle seat, and tier mismatch. Read-only OAuth, no credit card.