Crafting your organization’s digital transformation with Microsoft 365 cloud computing requires a solid and well-thought-out foundation. A strong foundation allows an organization’s workers to be productive, collaborate, perform better, and maintain privacy, compliance, and security. Correctly configurating your organization’s Microsoft 365 subscription and Microsoft Entra tenant provides that foundation, which is essential to make the most out of your Microsoft 365 environment.  

Microsoft 365 Environment Subscriptions and Plans 

Microsoft 365 subscriptions plans and subscriptions are not the same thing and it’s important to make that distinction. 

With Microsoft 365, a plan typically refers to a specific set of features and services included in your subscription. Microsoft offers various plans or editions of Microsoft 365 that each have different capabilities and pricing structures. These plans determine the specific features and applications available to users, and any other services or benefits included. You need to have a firm understanding of what you’re looking for and why.  

A subscription generally is the act of acquiring access to a particular Microsoft 365 plan. It involves paying a recurring fee to Microsoft for the right to use the selected plan’s features and services for a specified period. The subscription will usually include multiple licenses to cover multiple users. 

Building your cloud-computing foundation on a Microsoft 365 subscription and a Microsoft Entra tenant 

To build your cloud-computing foundation, you need to understand the relationship between a Microsoft 365 subscription and a Microsoft Entra tenant. 

A Microsoft 365 plan provides access to various Microsoft products like Word, Excel, PowerPoint, and Outlook, and cloud services for storage, collaboration, and communication (Exchange Online, SharePoint Online, OneDrive for Business, Microsoft Teams, etc.). When subscribing your organization to a Microsoft 365 plan, you can create user accounts, assign licenses to those accounts, and manage your subscription settings. 

When an organization purchases a subscription to a Microsoft 365 plan, Microsoft creates a Microsoft Entra tenant that supports those Microsoft 365 services. This Microsoft Entra tenant is the underlying foundation that enables user authentication, authorization, and other identity-related functionalities for the Microsoft 365. This single tenant environment allows for integration and management of Microsoft 365 and Azure services within your organization. 

A Microsoft 365 subscription is the paid plan that gives your organization access to Microsoft cloud services. A Microsoft Entra tenant holds all resources associated with that subscription and determines the URL for the organization’s services. This is where your organization’s Microsoft 365 Administrator will manage the company’s global settings, such as branding and security policies. 

Microsoft 365 plans that don’t create a Microsoft Entra tenant 

Organizations can purchase multiple plans from Microsoft in a single subscription. In these situations, Microsoft creates a single Microsoft Entra tenant for the subscription because some Microsoft 365 plans don’t create a Microsoft Entra tenant. These plans provide limited Microsoft Entra functionality and don’t include the full Microsoft Entra tenant creation. 

Some of the more common Microsoft 365 plans that don’t create a Microsoft Entra tenant include: 

1. Enterprise Mobility + Security (EMS) E5 
2. Microsoft 365 Business Basic 
3. Microsoft 365 Business Standard 
4. Microsoft 365 Apps 
5. Office 365 F3 
6. Microsoft 365 F1 

Although these plans don’t create a Microsoft Entra tenant, they can still have limited Microsoft Entra functionality for user management and authentication purposes. For more advanced Microsoft Entra ID capabilities and features, you would typically need to consider higher-tier plans like Microsoft 365 E3 or E5, which do create a Microsoft Entra tenant. 

Licenses for Your Microsoft 365 Environment  

The number of licenses will vary depending on your organization’s needs. It depends on how many users or seats you need. Understand this before purchasing your M365 subscription.  

Organizations with multiple Microsoft Entra tenants 

When you purchase a Microsoft 365 subscription, Microsoft creates a Microsoft Entra tenant which supports and provides the identity and access management infrastructure based on your subscription. A single tenant for Microsoft 365 and Microsoft Entra ID can help streamline administration, simplify user management, and establish consistent security and access controls across both platforms 

An organization can have multiple Microsoft Entra tenants for separate subscriptions. Each Microsoft Entra or Microsoft 365 subscription is associated with its own dedicated Microsoft Entra tenant. 

Large enterprise organizations often opt for multiple Microsoft 365 subscriptions to cater to their diverse needs of different user groups. They can tailor these subscriptions to specific roles or departments, providing the appropriate set of services and features required for each group.  

Large enterprises may choose to have multiple Microsoft 365 subscriptions because of different user requirements, licensing flexibility, compliance and security considerations, and mergers and acquisitions.  

It’s important to note that managing multiple subscriptions can be complex when managing the terms of license management, user provisioning, and administration. Having a dedicated IT team can help manage this complexity.  

Microsoft 365 Environment Tenant Information 

During the sign-up process for a Microsoft 365 plan, Microsoft asks the organization to provide some basic information (business name, country/region, and domain name). Microsoft uses this information when it creates the new Microsoft Entra tenant and bases the tenant URL it creates on the domain name provided by the organization.  

Once Microsoft creates an organization’s tenant, the organization’s administrator can sign in to the Microsoft 365 admin center to manage the subscription and its associated resources.  

You can add up to 900 domains to a single tenant and can use each domain to create email addresses for the users in those domains. 

An organization can’t have more than one tenant within a single Microsoft 365 subscription but can have multiple tenants by purchasing multiple Microsoft 365 subscriptions.  

Exploring Your Microsoft 365 Environment Conclusion 

If you are looking for a Microsoft 365 transformation, get in touch with us by filling out the form at the bottom of the page. We can help!  

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