Microsoft 365 F1 vs F3 vs Business Basic: Which Fits?

Microsoft 365 F1 is for staff who need Teams and nothing else. F3 is for staff who need Teams, a small mailbox, and a managed device. Business Basic is for anyone who lives in email.

Get that match wrong and you either overpay for a warehouse crew or hand a shift lead a license that can't send an email.

The short version:

• F1, $3: Teams, shared schedules, read-only Office. No email.
• F3, $10: a 2 GB mailbox plus Intune and Entra ID P1 to manage the device.
• Business Basic, $7: a 100 GB mailbox and 1 TB of OneDrive, but no Intune.

What do F1, F3, and Business Basic cost?

At Microsoft's list prices, paid yearly on an annual commitment:

• Microsoft 365 F1: $3.00 per user per month
• Microsoft 365 Business Basic: $7.00 per user per month with Teams, or $5.40 without
• Microsoft 365 F3: $10.00 per user per month

Notice the order. F3 now costs more than Business Basic. A lot of firms still assume "frontline" means "cheapest," and for F3 that stopped being true.

What's the difference between F1 and F3?

The mailbox. F1's Exchange Kiosk access covers the Teams calendar only, so F1 users can't send or receive email.

F3 adds a real 2 GB mailbox, editable web and mobile Office apps, Windows 11 Enterprise E3, and Intune Plan 1 for device management. Both include Teams and 2 GB of OneDrive.

That's the whole decision for most businesses. If the person needs an email address people can write to, F1 is out.

Side by side

From Microsoft's frontline plan page and Exchange Online limits:

• Email: F1, none (Teams calendar only). F3, 2 GB mailbox. Business Basic, 100 GB mailbox plus a 50 GB archive.
• Office apps: F1, read-only on web and mobile. F3, web and mobile Word, Excel, and PowerPoint. Business Basic, web and mobile Word, Excel, PowerPoint, and Outlook. None of the three include desktop apps.
• OneDrive: F1 and F3, 2 GB. Business Basic, 1 TB.
• Device management: F3 includes Intune Plan 1 and Windows 11 Enterprise E3. F1 and Business Basic don't include Intune.
• Identity: F1 and F3 both include Microsoft Entra ID P1, which is what you need for Conditional Access.

That last line matters more than it looks. Entra ID P1 is how you block sign-ins from unmanaged devices or foreign countries. Business Basic doesn't include it, so a Basic user is harder to lock down than an F3 user.

Who counts as a frontline worker?

Microsoft's definition is on its pricing page: employees "whose primary function is to work directly with customers or the public, selling products and providing services and support," plus staff in manufacturing and distribution.

In a small business, that's usually:

• Warehouse and shop-floor staff
• Retail and restaurant floor staff
• Home care aides and field technicians
• Drivers and delivery crews
• Front-desk staff who share one PC across shifts

It's not your office manager, your bookkeeper, or your sales team. People who sit at a desk all day and work in documents need a Business plan. F licenses aren't a discount code for desk workers.

Which one should each role get?

F1 fits staff who need schedules, shift chat, and company announcements on a phone: a delivery driver checking the day's route, a line cook checking the schedule.

At $3, it's also the cheapest way to get someone into your Microsoft 365 identity, so you can shut off their access properly when they leave.

F3 fits staff who need a company email address and a managed device, but don't write much: a home care aide filling out web forms on a company tablet, a shop-floor lead who gets purchase orders by email.

The Intune and Entra ID P1 rights are the real value. You can wipe a lost tablet and block sign-ins from anything you don't manage.

Business Basic fits anyone who uses email as a primary work tool but doesn't need desktop Office. A 2 GB mailbox fills up fast for someone who gets attachments all day. Basic's 100 GB won't.

Anyone who needs desktop Word and Excel belongs on Business Standard or Premium. We compare those in Business Premium vs Standard.

Can you mix F and Business licenses in one tenant?

Yes. Microsoft's frontline licensing guide says you can assign different licenses to different types of users. The common setup for a business with field staff is Business Premium for the office and F3 or F1 for the floor.

The mix is where the savings are. Putting a 40-person warehouse crew on F1 instead of Business Basic saves $4 per user per month, or $1,920 a year, and if all they use is Teams, they lose nothing.

Do a license review once a year. We've written about why in our Microsoft 365 price increase breakdown: departed employees still holding licenses and frontline staff on the wrong plan are where the money usually leaks.

Frequently asked questions

Can F1 users send email?

No. Microsoft lists F1's Exchange Kiosk access as covering the Teams calendar only.

F1 users can use Teams chat, see shared schedules, and read Office files on the web or a phone, but they have no mailbox for sending or receiving email. If a user needs email, choose F3 or Business Basic.

Is F3 the same as Business Basic?

No. F3 has a 2 GB mailbox and 2 GB of OneDrive, but it includes Intune, Entra ID P1, and Windows 11 Enterprise E3.

Business Basic has a 100 GB mailbox and 1 TB of OneDrive, but no Intune or Entra ID P1. F3 is about managing the device. Basic is about storage.

Do F-series licenses include desktop Office apps?

No. F1 gets read-only web and mobile versions of Word, Excel, and PowerPoint.

F3 gets editable web and mobile versions. Neither installs desktop Office on a PC. Staff who need desktop apps need Business Standard, Business Premium, or an enterprise E plan.

Can I put office staff on F3 to save money?

Don't. Microsoft defines frontline workers as people whose primary job is serving customers or working in manufacturing and distribution, not desk-based knowledge workers. Beyond the licensing question, a 2 GB mailbox and no desktop apps will frustrate anyone who works in email and documents all day.

Can F3 users get an email archive?

Not included. Microsoft's Exchange Online limits list no archive mailbox for F3 or Exchange Online Kiosk, though you can buy Exchange Online Archiving as an add-on. If a user needs to keep years of email, Business Basic's 50 GB archive is usually simpler.

Get the license mix right

Most firms with field staff are overpaying somewhere, and a few are underlicensed in ways that create security gaps. Book a complimentary Microsoft 365 review and we'll map each role to the right plan. Our Microsoft 365 management team can make the switch without disrupting anyone's inbox.