Why migrate “365 Apps for Enterprise” to “Office 365 E3” – Microsoft Treadmill
Instinct to “do nothing” can be entirely rational — and often correct — depending on goals, budget, and risk tolerance. Evaluation from a practical, strategic perspective.
THE CORE ISSUE: WHY MIGRATE Microsoft 365 Apps for Enterprise to Office 365 E3?
This proposed “upgrade” assumes you need more than just the apps — namely, hosted services like Exchange, SharePoint, or Teams. But if you don’t need those, then migrating is not only unnecessary — it might be wasteful.
REASONS TO DO NOTHING (Stay on Microsoft 365 Apps for Enterprise)
| Argument | Reasoning |
|---|---|
| 1. You already have the full Office apps | Word, Excel, PowerPoint, Outlook, Publisher, Access — installed, activated, and auto-updating. You’re good. |
| 2. You don’t need hosted email or cloud collaboration | No need for Exchange, SharePoint, Teams? Then E3’s big selling points are irrelevant. |
| 3. You avoid complexity and admin overhead | No mailboxes to manage. No Teams policies. No compliance settings. Just software. |
| 4. Security updates still apply | Microsoft continues to patch and update the apps regularly, even under standalone licenses. |
| 5. Cost control | Microsoft 365 Apps for Enterprise is cheaper than E3 (typically ~\$12 vs \$23/user/month). No need to double your license spend. |
| 6. No vendor lock-in pressure | The more services you use (Teams, Exchange, SharePoint), the harder it is to ever leave the Microsoft ecosystem. Simpler setups resist lock-in. |
| 7. Avoid cloud-dependence | No reliance on Microsoft’s uptime for email/calendar. You retain control of workflows, potentially even using local mail servers or third-party services (e.g., Gmail, ProtonMail, Zimbra). |
Why People Are Pressured to Upgrade to Office 365 E3
| Selling Point | Reality Check |
|---|---|
| “Get Exchange Online!” | But you might already have perfectly working email. |
| “Gain SharePoint!” | Do you actually need it? It adds layers of complexity and permissions headaches. |
| “Teams Collaboration!” | Only matters if your teams are actively using it — many businesses already use Slack, Zoom, etc. |
| “Compliance & DLP Tools!” | Only relevant in regulated industries or large enterprises. |
| “All-in-one integration!” | This is convenience, not necessity — and may come at the price of overcentralization. |
The Hidden Cost of Moving to E3
- IT overhead: More services = more things to break, more policies to manage, more admin interfaces to understand.
- User confusion: If your users just need apps and files, throwing Exchange + SharePoint + Teams at them may increase friction.
- Data exposure: Using cloud-hosted mail + storage increases the surface area for data breaches, leaks, or subpoenas.
When “Do Nothing” Is the Right Move
Stick with Microsoft 365 Apps for Enterprise if:
- You already have an alternate solution for email/calendar/collaboration.
- You want the apps only, not cloud services.
- Your team is small, self-sufficient, or not compliance-bound.
- You prefer simplicity, control, and cost efficiency.
Bottom Line
If your current setup works and you’re not missing features you need — there is zero technical, strategic, or financial obligation to migrate to Office 365 E3.
In fact, doing nothing often results in greater stability, less cost, and less vendor entanglement. The “upgrade” to E3 is only justifiable if your business use case truly requires the additional services — not just because Microsoft wants to upsell.
Microsoft 365 Apps for Enterprise is a subscription license, not a perpetual one.
Do They Expire?
✅ Yes — the apps are tied to an active subscription. If you stop paying:
- You lose access to premium features.
- After a grace period (usually 30 days), the apps enter reduced functionality mode.
What Happens If You Stop Paying?
| Time Since Cancellation | What Happens? |
|---|---|
| Day 0–30 | Grace period. All apps still work. You can renew. |
| Day 31+ | Apps enter Reduced Functionality Mode (RFM): |
| – You can view/read documents only | |
| – Editing, saving, printing = disabled | |
| – Most integrations stop working | |
| Eventually | May prompt login; deactivates entirely unless re-subscribed |
Can You Keep Using the Software Forever?
❌ No — not legally or practically. You’re leasing access, not owning a license.
If you want a one-time purchase (non-expiring), the alternative is:
- Office 2021/2024 LTSC (Perpetual, but no feature updates)
- This version does not include OneDrive, Teams, or Power Automate connectivity
Bottom Line
- Yes, Microsoft 365 Apps for Enterprise must be paid continuously — monthly or annually.
- If you want software that never expires, you’d need a non-subscription edition of Office, with tradeoffs (no cloud features, no AI, no Power Automate, etc).
License Renewal
Microsoft 365 Apps for Enterprise licenses typically auto-renew by default, especially if you’re managing them via:
- Microsoft 365 admin center (Microsoft direct)
- Volume Licensing (CSP / Enterprise Agreement / Open Value Subscription)
Here’s how renewal works based on the purchasing method:
HOW LICENSING AND RENEWAL WORK
1. Direct Purchase (Microsoft 365 Admin Center / Microsoft.com)
| Renewal Type | Default Behavior |
|---|---|
| Subscription | ✅ Auto-renews by default |
| Payment | Charged monthly or annually to your card or Microsoft account |
| Management | You can turn auto-renew off in admin.microsoft.com → Billing → Products & Services |
| License Renewal | Fully automatic unless you cancel |
2. CSP (Cloud Solution Provider / Reseller like GoDaddy, Pax8, Ingram)
| Renewal Type | Managed by your reseller |
|---|---|
| Subscription | Often set to auto-renew unless your provider disables it |
| Cancellation | You must request cancellation through provider |
| Management | May not have self-service portal |
3. Enterprise Agreement / Volume Licensing
| Renewal Type | Manually renewed through agreement cycle |
|---|---|
| Subscription | License keys & entitlements provisioned annually or every 3 years |
| Admin Behavior | Managed by IT / procurement, not automated billing |
TL;DR: How Are Licenses Renewed?
- Auto-renew is standard unless you explicitly turn it off.
- Monthly or annual billing depending on your choice.
- Grace periods apply if payment fails (usually 30 days).
- After grace period, apps fall into reduced functionality mode.
Cost Comparison
Here’s a clear, side-by-side comparison of the yearly cost of Microsoft 365 Apps for Enterprise vs Office 365 E3, per user:
Yearly Cost Comparison (per user)
| License Type | Monthly Cost (USD) | Yearly Cost (USD) |
|---|---|---|
| Microsoft 365 Apps for Enterprise | $12.00 (approx) | $144.00 |
| Office 365 E3 | $23.00 | $276.00 |
Cost Difference:
- Office 365 E3 costs $132 more per user per year than Microsoft 365 Apps for Enterprise.
- That’s a ~92% increase in cost.
What You’re Paying For in E3 (Extra)
| Feature/Service | Apps for Enterprise | Office 365 E3 |
|---|---|---|
| Word, Excel, PowerPoint, Outlook (Desktop) | ✅ | ✅ |
| OneDrive (1 TB) | ✅ | ✅ |
| Outlook email client | ✅ | ✅ |
| Hosted Exchange email (100 GB) | ❌ | ✅ |
| Teams (meetings, chat) | ❌ | ✅ |
| SharePoint intranet | ❌ | ✅ |
| Compliance/DLP tools | ❌ | ✅ |
| eDiscovery / Legal Hold | ❌ | ✅ |
| Power Automate (Standard) | ✅ (limited) | ✅ (standard level) |
When Is the Extra $132/yr Worth It?
Only if you need:
- Microsoft-hosted business email (Exchange)
- Teams collaboration backend
- SharePoint document sharing
- Legal or compliance tools (litigation hold, DLP)
- Integration of services for a managed enterprise environment
Bottom Line
| Use Case | Best Option |
|---|---|
| You only need the Office desktop apps | ✅ Microsoft 365 Apps for Enterprise |
| You need email/Teams/SharePoint/compliance | ✅ Office 365 E3 |
