Key takeaways_

• Business Basic is best for cloud-first teams that mainly need email, Teams, file sharing and web apps.
• Business Standard adds desktop Office apps, making it a stronger fit for users who create documents, spreadsheets and presentations daily.
• Many organisations get better value by mixing licences based on user needs, rather than giving everyone the same plan.

Choosing a Microsoft 365 licence should be simple. But, when comparing similar-looking plans and wondering which offers right balance of functionality, security and value for money, it quickly becomes complex.

Two of the most popular options for small and medium-sized businesses are Microsoft 365 Business Basic and Microsoft 365 Business Standard. Both provide access to Microsoft’s core productivity and collaboration tools, including Teams, Exchange Online, OneDrive and SharePoint. However, there are some important differences that can have a significant impact on how your people work day-to-day.

The decision isn’t simply about cost. It’s about ensuring employees have the tools they need to be productive, supporting hybrid working and investing in a platform that can scale alongside the organisation.

In this guide, we’ll compare Microsoft 365 Business Basic vs Standard, explore the key differences between the two licences and help you determine which option is the best fit for your organisation.

What’s included in Microsoft 365 Business Basic vs Standard?

Before comparing Microsoft 365 Business Basic vs Standard in detail, it’s helpful to understand what each licence includes.

Both plans are designed for businesses with up to 300 users and provide the core Microsoft tools needed for communication, collaboration and productivity. However, there are some important differences that can significantly impact how your employees work:

What is included in Microsoft 365 Business Basic?

Microsoft 365 Business Basic is Microsoft’s entry-level business licence, providing the essential tools needed for communication, collaboration and cloud-based working.

With Business Basic, you’ll get:

• Microsoft Teams for chat, meetings and collaboration
• Exchange Online for business email and calendars
• OneDrive for secure cloud file storage
• SharePoint for document management and internal collaboration
• Web and mobile versions of Word, Excel, PowerPoint and Outlook
• Real-time co-authoring and file sharing across teams
• Cloud-first access to your tools and documents from anywhere

For organisations that primarily work in browsers and rely on email, Teams and cloud collaboration, Business Basic provides everything needed to stay connected and productive.

What is included in Microsoft 365 Business Standard?

Microsoft 365 Business Standard includes everything available in Business Basic while adding the desktop applications many employees use every day.

In addition to the services above, Business Standard includes:

• Desktop versions of Word, Excel, PowerPoint, Outlook and other Office apps
• Installation across multiple devices, including PCs, Macs, tablets and mobiles
• Offline working capabilities when internet access is limited
• Advanced functionality within Office applications compared to web-only versions
• A more productive user experience for document-heavy roles
• Additional business applications and services for growing organisations

Microsoft 365 Business Basic vs Standard pricing_

When comparing Microsoft 365 Business Basic vs Standard, price is often one of the first considerations.

Business Basic starts from £4.20 per user, per month, whereas Business Standard starts at £8.30 per user, per month.

However, licence costs should rarely be assessed in isolation. It’s crucial to look at what you’re getting for your investment and which offers the best ROI.

It’s also important to consider the total cost of ownership. A £X difference per user may seem minimal when reviewing licensing options, but when multiplied across dozens or hundreds of employees, the annual spend can increase significantly. Equally, choosing a lower-cost licence that impacts employee productivity can create hidden costs that are far greater than the licence savings.

Is Business Standard worth the extra cost?

The answer depends on how your employees work. Business Standard is typically worth the additional investment when users spend a significant portion of their day creating documents, building spreadsheets, analysing data or delivering presentations. These users often benefit from the richer functionality, greater flexibility and familiar experience of the desktop applications.

Some of the key questions to consider include:

• How often do employees use Office applications? Occasional users may be perfectly productive with web apps, while daily users often benefit from the full desktop experience.
• How complex is the work being completed? Advanced Excel models, large presentations and document-heavy workflows are generally easier to manage in desktop applications.
• Do employees need to work remotely or offline? Desktop applications provide greater flexibility for hybrid and mobile workers who may not always have a consistent internet connection.
• Will productivity gains offset the additional licensing cost? Even small efficiency improvements, when multiplied across an entire workforce, can justify the higher licence cost.

For organisations that primarily use Teams, email and cloud storage, Business Basic may provide everything required. But for businesses where Microsoft applications are central to daily operations, Business Standard often delivers stronger long-term value despite the higher monthly investment.

Other key differences_

Alongside what we’ve mentioned, there are more key differences to be aware of.

Productivity and user experience_

Business Basic works well for organisations that primarily use Microsoft 365 for communication and collaboration. If users spend most of their time in Teams, email and web-based applications, they may never feel limited by the licence.

However, organisations with employees who regularly create documents, analyse data or develop presentations often benefit from Business Standard. The desktop applications offer:

• More advanced functionality
• Faster performance for large files
• Greater customisation options
• Enhanced offline capabilities
• Fewer feature restrictions than web-based versions

While web applications have improved significantly in recent years, there are still scenarios where desktop apps provide a smoother and more productive experience.

Deployment and device flexibility_

Business Standard also provides greater flexibility when it comes to device management and user experience.

Because users can install Office applications directly onto their devices, they gain access to a consistent experience whether they’re working in the office, at home or on the move. This can be particularly valuable for organisations supporting hybrid working arrangements, remote or travelling employees and multi-site operations.

Having the same applications available across multiple devices helps reduce friction and ensures employees can work effectively wherever they are.

Long-term scalability_

When choosing a Microsoft 365 licence, it’s important to consider both current requirements and future needs.

Business Basic can be an excellent fit for organisations focused on cost control and cloud-based collaboration. However, as businesses grow, employees often become more reliant on advanced Office functionality and more complex workflows.

Many organisations find that users who initially only need email and Teams eventually require the desktop Office applications to support their day-to-day responsibilities. For this reason, Business Standard is often viewed as a longer-term investment. While the licensing cost is higher, it provides additional flexibility and can help avoid future upgrades as employee requirements evolve.

If your organisation expects growth, increasing operational complexity or greater reliance on Microsoft productivity tools, Business Standard may offer stronger long-term value.

Which licence should you choose?

When comparing Microsoft 365 Business Basic vs Standard, there is no universally “better” option. The right licence depends on how your employees work, which tools they rely on and whether productivity gains justify the additional investment.

Choose Microsoft 365 Business Basic if:

Business Basic is typically the right fit if:

• Your employees primarily use email, Teams and file sharing
• Most work is completed through web browsers and cloud applications
• Cost control is a key consideration
• You have frontline, operational or occasional users who don’t spend much time in Office applications
• Users need access to Microsoft 365 services but don’t require desktop software

Choose Microsoft 365 Business Standard if:

Business Standard is often the better choice when:

• Employees spend significant time in Word, Excel, PowerPoint or Outlook
• You support a hybrid or remote workforce
• User productivity is a strategic priority
• Staff need desktop applications rather than browser-only tools
• Employees regularly work offline or travel between locations
• Teams create complex documents, spreadsheets, reports or presentations

Can you mix and match licences?

Yes. In fact, many organisations achieve the best balance of cost and functionality by assigning different licences to different user groups.

A common approach is to provide:

• Business Basic for frontline workers, operational teams and occasional users
• Business Standard for managers, finance teams, operations teams and leadership functions
• Business Standard for employees who spend most of their day working within Office applications

This approach allows organisations to optimise licensing costs without over-licensing every employee. By aligning licences to employee requirements, organisations can reduce unnecessary spend while ensuring the people who need advanced productivity tools have access to them.

Frequently asked questions_

Does Microsoft Teams come with Microsoft 365 Business Basic and Business Standard?

Microsoft Teams is available alongside both Microsoft 365 Business Basic and Business Standard, but it’s not included in all licensing options by default.

Many Microsoft 365 plans are now sold both with and without Teams, meaning organisations need to choose an option that includes Teams if they want it. For Business Basic, prices start from £5.40 with Teams. For Standard, it’s £10.80.

Can I use Microsoft Copilot with Business Basic or Business Standard?

Yes. Organisations using either Microsoft 365 Business Basic or Business Standard can purchase Microsoft 365 Copilot as an additional licence, provided they meet Microsoft’s eligibility requirements. There is also a ‘Business Standard with Copilot’ license, which starts at £18.10 per user, per month.

What happens if my organisation grows beyond 300 users?

Microsoft 365 Business licences are designed for organisations with up to 300 users. If your organisation grows beyond this limit, you may need to transition to Microsoft’s Enterprise licensing options, such as Microsoft 365 E3, E5 or E7.

Many organisations also review their licensing strategy as they grow to ensure they continue to meet security, compliance and productivity requirements.

Can I change licences without losing my data?

Yes. Upgrading or changing Microsoft 365 licences does not typically affect user data, emails, files or SharePoint content.

Because all data remains within your Microsoft 365 tenant, organisations can usually move users between licence types as requirements change. This allows businesses to adapt their licensing strategy over time without disrupting day-to-day operations.

How often should you review your Microsoft 365 licences?

At a minimum, organisations should review their licensing estate annually. However, businesses experiencing rapid growth, restructuring or technology change may benefit from more frequent reviews.

Regular licence audits can help identify underused licences, users assigned the wrong licence type and opportunities to optimise spend while ensuring employees have access to the tools they need.

Do Business Basic and Business Standard include security features?

Yes. Both licences include Microsoft’s foundational security capabilities, such as identity management, email protection and device access controls.

However, organisations with more advanced security, compliance or threat protection requirements may need to consider additional Microsoft security products or higher-tier Microsoft 365 licences (such as E5). As cyber threats become more sophisticated, many businesses choose to review security requirements alongside licensing decisions.

Choosing your license_

Choosing between Microsoft 365 Business Basic and Business Standard ultimately comes down to how your employees work.

If your organisation primarily relies on email, Teams, file sharing and browser-based applications, Business Basic provides a cost-effective foundation for communication and collaboration. However, if employees spend significant time creating documents, analysing data, building presentations or working across multiple locations, Business Standard’s desktop applications and enhanced productivity capabilities can quickly justify the additional investment.

The good news is that this doesn’t have to be an all-or-nothing decision. Many organisations achieve the best balance of cost, productivity and user experience by assigning different licences to different user groups, ensuring employees get the tools they need without overspending on licences they won’t use.

It’s also worth remembering that Business Basic and Business Standard are just two of the many Microsoft 365 licensing options available. As your organisation grows, you may also want to consider higher tiers that better fit your needs.

Download our Microsoft 365 licensing table for a side-by-side comparison of every Microsoft 365 licence, from Business Basic through to E5. You’ll get a clear breakdown of features, use cases and ideal customer profiles, helping you identify the best-fit licence for your organisation today and in the future.