5 basic facts about Microsoft 365 (M365) licensing

Microsoft 365 (M365) is one of the core offerings of Microsoft, representing a comprehensive suite of productivity and collaboration tools. It is designed to meet the needs of individuals and businesses alike. It encompasses a wide range of services, including the familiar Office applications (Word, Excel, PowerPoint) along with powerful communication and collaboration tools like Teams and Outlook. These are all delivered through a cloud-based subscription service. 

Understanding the licensing of Microsoft 365 is crucial for maximizing the suite’s benefits while ensuring cost-effectiveness. Whether you’re a solo entrepreneur, part of a growing business, or managing enterprise-scale IT infrastructure, knowing the ins and outs of Microsoft 365 licensing can help you tailor the service to your specific needs.  

Here are five basic facts to get you started. 

Fact 1: M365 offers a variety of plans to suit different needs

Microsoft 365 tailors its offerings to meet diverse needs, ensuring there’s a plan for everyone – from individual home users to multinational corporations. The suite includes familiar applications like Word, Excel, and PowerPoint, along with powerful collaboration tools such as Teams and Outlook. 

  • For individuals and families: Options include personal and family plans, providing advanced features and additional cloud storage. 
  • For businesses: Plans are designed to scale, offering solutions for small businesses all the way up to large enterprises, with varying degrees of service such as business-class email, online meetings, and much more. 
  • For education and nonprofits: Specialized plans support the unique needs of educational institutions and nonprofit organizations at discounted rates. 

Understanding the nuances between these plans ensures you can select the one that best fits your specific requirements, blending functionality with cost-effectiveness. 

Fact 2: Microsoft 365 (M365) is a subscription-based model

Microsoft 365 operates on a subscription basis, offering flexibility through monthly or annual payment options. This model ensures users always have access to the latest version of each application, including all updates and new features, without needing to purchase new software outright. 

 The benefits of this model go beyond just software access, subscriptions include cloud storage with OneDrive, enabling secure and easy access to your files from anywhere. Additionally, subscribers receive targeted support directly from Microsoft, ensuring any issues are promptly resolved. 

Fact 3: M365 is licensed per user, not per device

A significant advantage of Microsoft 365’s licensing model is its user-centric approach. Instead of tying a license to a specific device, each subscription is associated with a user. This allows, for instance, the installation of the Office suite on up to five devices simultaneously. 

This flexibility is invaluable for today’s mobile workforce, enabling seamless transitions between working at the office, home, or on the go. You can work from anywhere.  

For businesses, this simplifies the management of licenses, ensuring that each team member has the tools they need, regardless of their work location. 

Fact 4: You can mix and match plans in M365

One size doesn’t always fit all, especially in a diverse organizational landscape. Microsoft 365 accommodates this reality by allowing businesses to mix and match plans across their teams. 

This means tailored solutions. This approach enables organizations to closely align their software subscriptions with the specific needs of different departments or roles within the company, optimizing both cost and functionality.

We will be publishing a more in-depth blog on Microsoft 365 licensing soon, so keep an eye out for it. In the meantime, you can check out the M365 maps website for information on the functionality of the different M365 plans.  

Fact 5: Microsoft 365 is a leader in compliance and security features

Security and compliance are paramount, particularly for businesses handling sensitive information. Microsoft 365 plans come with built-in features designed to safeguard data and assist in compliance with industry regulations. 

Features like data loss prevention, advanced threat protection, and mobile device management are just a few examples of the tools available to protect your data. 

With tools designed to help meet legal and regulatory standards, Microsoft 365 simplifies the complexities of compliance for businesses. This is a key development area for Microsoft, and they have invested immensely in this space over the past years. Microsoft is now considered a leader in the security and compliance space. 



Microsoft 365’s licensing offers flexibility, scalability, and a wealth of features designed to meet the needs of different users and organizations. By understanding these five key facts, you can make more informed decisions about which plans and features align with your needs, ensuring you get the most out of your investment. 

For businesses looking to navigate the complexities of Microsoft 365 licensing, the right guidance is crucial to making informed decisions that align with your organizational goals and budget. LicenseQ specializes in providing expert advice and tailored solutions for your Microsoft 365 licensing needs. Whether you’re seeking to optimize your current subscription plan, expand your suite of tools, or understand the best practices for license management, LicenseQ is here to help.  


Don’t let licensing queries slow down your business’s progress. Contact LicenseQ today for personalized support and take the first step towards simplifying your Microsoft 365 licensing strategy.