Understand subscriptions and licenses in Office 365 for business

This article explains the relationship between subscriptions and licenses in Office 365 for business, and provides additional information about who can assign licenses, what happens when you assign a license to someone, and how many devices can people install Office on. It also includes links to articles about non-user mailboxes, and links to other licensing articles.

When you buy a subscription to Office 365 for business, you sign up for a set of applications and services that you pay for on a monthly or annual basis.

Monthly and Annual subscription options, with an arrow pointing to Annual.

The applications and services that you receive as part of your subscription depend on which product you purchased.

Choices for Office 365 Business and Office 365 Business Premium, with the an arrow pointing to the Buy button beneath Office 365 Business Premium.

When you buy a subscription, you specify the number of licenses that you need, based on how many people you have in your organization.

Four large person icons, with a smaller person icon in orange with a plus sign, and an arrow pointing to it.

After your purchase is complete, you create accounts for people, and then assign a license to each person.

Three user icons, two with checkmarks next to them, indicating that licenses have been assigned, and one without a checkmark with an arrow pointing to it, indicating that a license is about to be assigned to it.

As your organizational needs change, you can buy more licenses to accommodate new people.

A large, orange user icon with a plus sign and an arrow pointing to it.

When someone leaves your organization, you can remove a license from that person, and assign it to a different person.

Two small user icons with checkmarks, and one with an x next to it, indicating that a license was removed. To the right is a large orange user icon with a plus sign and an arrow pointing to it, indicating that it is replacing the one that was removed.

If you have more than one Office 365 for business subscription, you can assign licenses to different people for each subscription.

A box for Visio Pro and one for Office 365 Business Premium. Dotted lines connect to four user icons below the boxes.

Find out who can assign licenses

Different types of admins can work with licenses in different ways, depending on their roles. The following table lists the most common options. For a complete list of admin roles and privileges, see About admin roles.

Admin role

Assign a license

Remove a license

Purchase more licenses

Delete an account

Global admin

Yes

Yes

Yes

Yes

Billing admin

No

No

Yes

No

User management admin

Yes

Yes

No

Yes

Service admin

No

No

No

No

Password admin

No

No

No

No

Understand what happens when you assign a license to someone

The following table lists what automatically happens when you assign a license to someone:

If the subscription has this service

This automatically happens

Exchange Online

A mailbox is created for that person.

SharePoint Online

Edit permissions to the default SharePoint Online team site are assigned to that person.

Skype for Business Online

The person will have access to the features associated with the license.

Office 365 ProPlus

The person will be able to download Microsoft Office on up to 5 Macs or PCs, 5 tablets, and 5 smartphones.

How many devices can people install Office on?

If your subscription includes any of the following products, each person can install Office on up to 5 PCs or Mac, 5 tablets, and 5 phones.

  • Office 365 Business

  • Office 365 Business Premium

  • Office 365 ProPlus

  • Office 365 Enterprise E3

  • Office 365 Enterprise E5

Understand licenses for non-user mailboxes

You don’t need to assign licenses to resource mailboxes, room mailboxes, and shared mailboxes, except when they are over their storage quota of 50 gigabytes (GB). For more about non-user mailboxes, see the following articles:

Articles about managing licenses for Office 365 for business

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