Office 365 G1, G3, G5 Government Plan Comparison

Microsoft 365 Government plans are purpose-built for US public sector organizations including federal, state, local, and tribal agencies, as well as qualified contractors. These plans offer:

• Compliance with FedRAMP, ITAR, CJIS, and other US government regulations
• US-based data residency with logically segregated infrastructure
• Access limited to screened US personnel
• Familiar productivity tools: Word, Excel, Teams, SharePoint, OneDrive
• Advanced threat protection and identity management

Plans like Office 365 G1, Office 365 G3 GCC, and Microsoft 365 G5 are tailored to different levels of operational needs, giving agencies the flexibility to select based on required security, collaboration, and analytics capabilities.

Office 365 Government is a secure productivity and collaboration solution tailored for US government agencies and contractors. Built on the standard Office 365 platform, it operates in a dedicated government cloud environment that ensures strict compliance with federal security and data residency requirements. Unlike commercial offerings, Office 365 Government provides logically segregated infrastructure and restricts access to screened US personnel, helping agencies meet regulations like FedRAMP, ITAR, and CJIS. It delivers the same core apps, including Exchange, Teams, SharePoint, and OneDrive, with added safeguards for sensitive workloads. These Government-focused tiers enable agencies to support secure remote work and maintain operational efficiency without compromising compliance.

For government users comparing Microsoft G3 vs G5, the key differences lie in analytics, security automation, and advanced compliance tools offered by the G5 license.

Microsoft Government licenses are available only to organizations that meet specific eligibility criteria validated by Microsoft. These include US federal, state, local, tribal, and territorial government bodies, as well as contractors who manage data subject to government regulations such as CUI, FTI, CJIS, or ITAR. Some non-government entities may also qualify if they are authorized under state procurement laws or sponsored by a government agency for regulatory purposes. All applicants must complete a formal validation process before purchasing, and Microsoft may reverify eligibility at renewal or if organizational status changes. It’s important to note that Office 365 DoD plans remain exclusive to the Department of Defense and its cleared contractors. Continuous eligibility is required to maintain access to offerings like the Microsoft 365 G3 GCC or Microsoft 365 G5 plans.

Microsoft’s government cloud offerings are purpose-built for public sector organizations. Each plan offers increasing levels of functionality to meet diverse compliance, collaboration, and security needs.

Office 365 G1 is a cost-effective option focused on web-based productivity and basic compliance. Microsoft 365 G3 introduces full desktop Office apps, enhanced compliance features, and additional storage, making it ideal for mid-tier needs. Microsoft 365 G5 builds on G3, offering the most robust package with integrated voice, advanced threat protection, and analytics, suited for agencies with high security and regulatory demands.

Feature Comparison: Microsoft 365 G1 vs G3 vs G5

Office 365 G1 includes web-based Office apps only, while Microsoft 365 G3 and G5 offer full desktop, mobile, and web versions. G1 provides a 50 GB mailbox and 1 TB OneDrive storage; G3 and G5 raise this to a 100 GB mailbox and unlimited OneDrive (with 5+ users).

All plans support Teams, SharePoint, and OneDrive, but G3 and G5 include enhanced compliance and security tools. G3 adds features like legal hold and eDiscovery, while G5 includes Microsoft Defender, advanced threat protection, and analytics. Voice services and Power BI Pro are only available with the G5 license.

Microsoft G3 vs G5 License – Which is Better?

Choosing between the Microsoft G3 license and G5 license depends on the level of security and analytics your agency requires. Microsoft 365 G3 is ideal for organizations that need desktop apps, more storage, and core compliance features without high-end security tools. It’s a smart middle ground for most public agencies.

On the other hand, Microsoft 365 G5 is designed for environments requiring proactive security and real-time analytics. It includes everything in G3 plus Power BI Pro, Microsoft Defender, and voice capabilities. Agencies managing highly sensitive workloads or regulatory mandates often benefit from the G5 license’s extended protections.

Microsoft’s government cloud licensing follows a per-user, per-month model with annual commitments. Plans are priced competitively against commercial equivalents, factoring in government compliance and usage volume.

Microsoft G1, G3 & G5 License Costs

• G1: ~$10.00/user/month
• G3: ~$23.00/user/month
• G5: ~$38.00/user/month

These prices reflect standard G1, G3, and G5 license tiers, with discounts often available for large deployments or multi-year agreements. Microsoft 365 Government G3 pricing sits at the mid-point, offering strong value for agencies balancing features and budget. Actual costs may vary based on partner contracts and user count.

Microsoft G3 vs G5 License Pricing Differences

The G5 license is priced higher than the Microsoft G3 license due to its inclusion of advanced tools like Microsoft Defender, Power BI Pro, and audio conferencing. While the Microsoft G5 license cost reflects its expanded capabilities, agencies must consider if those features are essential for their compliance framework.

In many cases, Microsoft 365 G3 GCC provides the optimal balance of security, usability, and affordability. However, when analyzing Microsoft G3 vs G5 for highly regulated operations, the investment in G5 often proves worthwhile.

Microsoft 365 GCC plans are purpose-built for U.S. government organizations and contractors that must meet compliance standards like FedRAMP, DFARS, and CJIS. These plans offer increasing layers of security and compliance features.

All GCC plans ensure U.S. data residency, background-checked support personnel, and logical separation from commercial cloud services. From G1 to G5, capabilities expand to include tools such as encryption, data loss prevention, eDiscovery, and threat protection. For agencies evaluating advanced threat protection costs, see our breakdown of Microsoft Defender for Endpoint plans. The Microsoft G3 license is well-suited for agencies that need strong productivity with advanced compliance, while the G5 license adds high-end features for more sensitive environments.

• What Is GCC High & Who Needs It?

  GCC High is a specialized version of Microsoft 365 for federal agencies and certain contractors that handle Controlled Unclassified Information (CUI) or data subject to ITAR and CMMC Level 3+. It offers exclusive U.S.-based infrastructure, screened support personnel, and additional compliance protections beyond standard Office 365 G3 GCC or G5 offerings.

  Organizations working under DFARS 7012 or managing ITAR/NOFORN data are often required to use GCC High. Eligibility is restricted to U.S. government entities and contractors with validated requirements.

• Does G3 or G5 Meet CMMC Requirements?

  Both Microsoft 365 G3 GCC and Microsoft 365 G5 can support CMMC 2.0 Level 2 compliance when properly configured. The G3 license includes essential compliance features, and with the right security controls, it can meet moderate-level requirements.

  For organizations requiring more robust protection and easier alignment with CMMC controls, the Microsoft G5 license provides advanced tools like Microsoft Defender and enhanced eDiscovery. The choice between Microsoft G3 vs G5 should be based on security needs, compliance scope, and G3 pricing vs the added value of the G5 license.

• Is Microsoft 365 G5 License CMMC Compliant?

  The Microsoft 365 G5 license in GCC High includes all necessary tools for supporting CMMC Levels 2 and 3. It offers access to Compliance Manager with built-in CMMC templates, Microsoft Defender, and audit-ready reporting.

  For secure communication, see how our Office 365 email encryption solution helps protect sensitive messages and support compliance.

  While Microsoft G5 license cost is higher, its comprehensive security capabilities streamline compliance for organizations under strict regulatory obligations. Still, proper setup and ongoing management are essential to ensure full CMMC compliance.