Microsoft Entra Licensing Advisory
Maximise outcomes from your current licenses and make informed decisions about licensing upgrades
Why Licensing Matters
Licensing is not just a procurement decision. It directly determines which identity security and governance capabilities are available to your organisation. The difference between Entra ID Free and Entra ID P2 is not merely a price point: it is the difference between having no Conditional Access and having risk-based Conditional Access with automatic remediation.
Organisations that do not understand their licensing often implement workarounds for problems that their existing licenses already solve, or they delay security improvements because they assume a licensing upgrade is required when it is not. Conversely, organisations that invest in premium licensing without a clear adoption plan waste budget on capabilities that sit unused.
Request a Licensing ReviewIndependent Advisory
Entraneer is an identity engineering consultancy, not a licensing reseller. We do not earn commissions or margins on license sales. Our recommendations are driven entirely by your organisation's best interests, not sales targets.
Before recommending any changes, we conduct a thorough assessment of what your current tier enables and what your organisation is actually using. Many organisations with P1 licensing are only using a fraction of available capabilities.
Entra Licensing Tiers Explained
Microsoft Entra ID Free (formerly Azure AD Free), Microsoft Entra ID P1 (formerly Azure AD Premium P1), Microsoft Entra ID P2 (formerly Azure AD Premium P2), and Microsoft Entra Suite
FreeEntra ID Free
Included with every Microsoft 365 subscription. Microsoft Entra ID Free (formerly Azure AD Free) provides basic directory services, security defaults with MFA enforcement, limited SSO for SaaS applications, and foundational user and group management. Sufficient for small organisations with basic identity requirements, but lacks Conditional Access, self-service password reset, and dynamic groups.
P1Entra ID P1
Microsoft Entra ID P1 (formerly Azure AD Premium P1) adds Conditional Access policy engine, self-service password reset, dynamic group membership, Application Proxy for on-premises application publishing, and hybrid identity support with Entra Connect. The most common tier for mid-market organisations. Many P1 tenants have significant untapped capability that can be activated without additional spend.
P2Entra ID P2
Microsoft Entra ID P2 (formerly Azure AD Premium P2) builds on P1 with Privileged Identity Management for just-in-time admin access, Identity Protection with risk-based Conditional Access and automatic remediation, access reviews for periodic certification of group and role memberships, and entitlement management through self-service access packages. Essential for organisations with significant compliance requirements or large admin populations.
SuiteMicrosoft Entra Suite
Bundles Entra ID P2 with Entra Internet Access, Entra Private Access, and additional governance capabilities into a single per-user license. For organisations already holding E5 or P2, the Entra Suite represents a cost-effective path to adopting Global Secure Access and advanced governance. We help you determine whether the Suite makes financial sense based on your specific feature requirements.
Microsoft Entra ID Governance Licensing Add-Ons
Microsoft Entra ID Governance Step Up for Microsoft Entra ID P2, Microsoft Entra ID Governance Frontline Worker, Microsoft Entra ID Governance Step Up for Microsoft Entra ID F2, and Microsoft Entra ID Governance Add-on for Microsoft Entra ID P2 for Government
Beyond the core licensing tiers, Microsoft offers several governance add-on SKUs tailored to specific organisational needs. The Microsoft Entra ID Governance Step Up for Microsoft Entra ID P2 extends P2 tenants with advanced lifecycle workflows, entitlement management, and automated access reviews that go beyond what P2 provides natively. For organisations with a large frontline workforce, the Microsoft Entra ID Governance Frontline Worker license delivers simplified governance controls purpose-built for shift-based and kiosk users at a lower per-user cost. Similarly, the Microsoft Entra ID Governance Step Up for Microsoft Entra ID F2 provides governance capabilities to organisations licensing frontline staff under the F2 plan. Government tenants can leverage the Microsoft Entra ID Governance Add-on for Microsoft Entra ID P2 for Government to meet sovereign compliance requirements while benefiting from the same governance automation. We help Australian organisations determine which governance add-on aligns with their user populations and compliance obligations.
Microsoft 365 E7 and the Agentic AI Era
Microsoft 365 E7, branded as the Frontier productivity suite, represents the highest tier of Microsoft's enterprise licensing. Built for organisations adopting agentic AI at scale, E7 bundles advanced security, compliance, and AI capabilities that position identity as the control plane for autonomous agents.
As AI agents act on behalf of users, approve workflows, access sensitive data, and interact with external systems, the identity layer becomes the primary enforcement boundary. E7 Frontier licensing ensures your organisation has the Entra capabilities needed to govern agent identities with the same rigour as human users.
Discuss E7 LicensingWhy E7 Matters for Agentic AI
Agentic AI introduces non-human identities that operate autonomously within your tenant. These agents require Conditional Access enforcement, Privileged Identity Management controls, workload identity protection, and continuous access evaluation to ensure they operate within defined boundaries.
E7 Frontier consolidates the licensing required to secure these scenarios: Copilot and agent orchestration, Security Copilot for identity threat investigation, and the full Microsoft Entra Suite for governance and network access control.
Microsoft Entra Suite: Inside E7 Frontier
E7 includes the full Microsoft Entra Suite, unlocking identity governance, network access, and agent security capabilities in a single license
Entra Suite Capabilities
- Entra ID P2 with Privileged Identity Management, Identity Protection, and risk-based Conditional Access
- Entra ID Governance for access reviews, entitlement management, and lifecycle workflows
- Entra Internet Access for identity-aware Secure Web Gateway and tenant restrictions
- Entra Private Access to replace legacy VPN with identity-driven Zero Trust Network Access
- Workload identity premium for securing service principals, managed identities, and AI agent credentials
Agentic AI Enablement
- Govern Copilot agents and custom AI agents through Conditional Access policies scoped to workload identities
- Enforce least-privilege for agents using Privileged Identity Management with time-bound, approval-gated role activations
- Continuously evaluate agent sessions with Continuous Access Evaluation to revoke access in near real-time when risk changes
- Audit and certify agent permissions through automated access reviews, ensuring agents retain only the access they need
- Secure agent-to-resource communication through Entra Private Access, eliminating broad network exposure
Our Advisory Approach
A structured engagement that moves from discovery through to actionable recommendations
- 1
License Audit & Discovery
We audit your current Microsoft 365 and Entra license assignments, identify unused or underutilised capabilities, and document your organisation's identity and security requirements. This produces a prioritised list of quick wins: capabilities already licensed that you can adopt immediately.
- 2
Requirements Mapping & Analysis
We map your security, governance, and operational requirements to licensing tiers. We model different licensing scenarios with cost projections and identify the optimal strategy that balances capability coverage with budget efficiency.
- 3
Business Case & ROI Modelling
When a licensing upgrade is warranted, we build a business case that quantifies ROI in terms your leadership understands: helpdesk cost reduction, risk reduction in dollar terms, IT time savings, and operational efficiency gains. All models are tailored to Australian market conditions.
- 4
Recommendation & Roadmap
We deliver a clear report with a prioritised adoption plan for unlicensed capabilities, a business case for any recommended upgrades, a licensing assignment strategy that minimises cost, and a roadmap for feature adoption post-licensing change. We can also assist with implementation.
Where Licensing Delivers ROI
Tangible returns that justify your identity investment to leadership
Helpdesk Cost Reduction
Self-service password reset and automated access lifecycle management significantly reduce tier-one support ticket volume and resolution time.Quantified Risk Reduction
Conditional Access and Identity Protection reduce breach probability. We model risk reduction in dollar terms using industry breach cost data for Australian organisations.IT Team Time Savings
Automated access reviews replace manual recertification processes. Entitlement management eliminates ad-hoc access provisioning, freeing your team for strategic work.Targeted Licensing Strategy
License only administrators with P2 for PIM while maintaining P1 for the general population. Group-based licensing ensures premium features reach only the users who need them.Frequently Asked Questions
Do we need Entra ID P2 for Conditional Access?
No. Standard Conditional Access policies are included with Entra ID P1 licensing. P2 adds risk-based Conditional Access, which uses Identity Protection signals such as user risk and sign-in risk to dynamically adjust policy enforcement. If your organisation needs to enforce MFA for specific applications, block legacy authentication, or require compliant devices, P1 is sufficient. If you want to automatically respond to detected compromised credentials or impossible travel scenarios, P2 is required.
What is the Microsoft Entra Suite and should we consider it?
The Microsoft Entra Suite is a per-user license bundle that includes Entra ID P2, Entra Internet Access, Entra Private Access, and enhanced governance capabilities. It is designed for organisations that want to consolidate identity, network access, and governance under a single licensing model. If your organisation is already considering Global Secure Access or has advanced governance requirements, the Entra Suite may offer better value than purchasing individual components separately. We assess whether the Suite makes sense based on your specific feature requirements and existing license investments.
What is Microsoft 365 E7 Frontier and how does it relate to Entra licensing?
Microsoft 365 E7, also known as Frontier, is the highest tier of Microsoft enterprise licensing. It includes the full Microsoft Entra Suite alongside advanced AI capabilities such as Copilot agents and Security Copilot. For organisations adopting agentic AI, E7 provides the identity governance and security capabilities needed to manage non-human identities at scale. This includes workload identity protection, Privileged Identity Management for agent credentials, and Continuous Access Evaluation for real-time session control. We help organisations assess whether E7 represents the right investment based on their AI adoption roadmap and current licensing position.
Can we license different user populations at different tiers?
Yes, and this is one of the most effective cost optimisation strategies. Microsoft allows mixed licensing within a tenant. For example, you might license administrators and high-risk users with Entra ID P2 for PIM and Identity Protection, while licensing the general population with P1 for standard Conditional Access and self-service password reset. Group-based licensing in Entra ID makes this straightforward to manage. We help you design the assignment strategy and implement the licensing groups.
How often should we review our Entra licensing?
We recommend a formal licensing review at least annually, or whenever significant changes occur such as a Microsoft licensing model update, a major organisational change like a merger or divestiture, or when your security requirements evolve. Microsoft updates Entra capabilities and licensing structures regularly, and features that previously required premium licensing occasionally move to lower tiers. An annual review ensures you are not paying for capabilities that have become available at your current tier.
Is your advisory independent from Microsoft licensing resellers?
Yes. Entraneer is an identity engineering consultancy, not a licensing reseller. We do not earn commissions or margins on license sales. Our advisory recommendations are driven entirely by what is best for your organisation. When licensing changes are recommended, you can purchase through your existing Microsoft relationship, your preferred reseller, or directly from Microsoft. This independence is fundamental to the trust our clients place in our advice.
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