OneNote is Microsoft's note-taking and information-gathering application. It functions as a personal or shared notebook, integrating with Outlook, Teams, and other M365 services. Unlike Word or Excel, OneNote is free across all commercial M365 tiers—there is no licence cost to activate it.
Microsoft offers multiple OneNote client experiences, which creates confusion around versions:
For enterprise deployments, guidance is clear: use OneNote (the modern Windows app) or OneNote Online. Do not rely on OneNote for Windows 10, which is approaching end-of-life.
OneNote is included at no additional cost in every Microsoft 365 commercial plan:
| M365 Plan | OneNote Included? | OneDrive Storage | SharePoint Storage |
|---|---|---|---|
| E1 | Yes | 1 TB | Shared at 1 TB / 5 users |
| E3 | Yes | 1 TB | Shared at 1 TB / 5 users |
| E5 | Yes | Unlimited | Unlimited |
| Business Basic | Yes | 1 TB | 1 TB shared |
| Business Standard | Yes | 1 TB | 1 TB shared |
| Business Premium | Yes | 1 TB | 1 TB shared |
Note: OneNote has no separate licence. Storage limits are for OneDrive/SharePoint, used by OneNote notebooks and email.
There is no option to "add OneNote" to a plan. It comes with every commercial M365 subscription. If you are being quoted a separate OneNote licence charge, that is a misconfiguration or misunderstanding of the M365 bundle.
This is the most misunderstood aspect of OneNote licensing: OneNote notebooks do not have separate storage. They consume the user's OneDrive allocation or the team's SharePoint allocation.
When a user creates a personal OneNote notebook in their account, it lives in their OneDrive root folder. The notebook consumes storage from their OneDrive allocation:
This 1 TB allocation is shared with Outlook mailbox storage (100 GB), OneDrive files, and any other content stored in the user's OneDrive. OneNote is not "free" in the sense of not consuming storage—it shares the pool with email and file storage.
When a team or organisation creates a shared OneNote notebook (often in a Teams channel or team site), it lives in SharePoint. The notebook consumes storage from the team site's SharePoint allocation:
Example: A team of 50 people on E3 has shared SharePoint storage of 10 TB (50 users ÷ 5 × 1 TB). A shared OneNote notebook, team files, and other SharePoint content all consume from this 10 TB pool.
For organisations with heavy OneNote usage (e.g., education institutions with classroom notebooks), storage planning becomes critical:
Storage limits do not increase the licence cost, but they do require provisioning planning. E5 (unlimited storage) is a primary differentiator for organisations with heavy collaborative note-taking needs.
The modern OneNote application is cloud-native and optimized for Teams and SharePoint integration. It is the product Microsoft is actively developing and where new features land. Features include:
OneNote for Windows 10 was a Universal Windows Platform app published to the Microsoft Store. It is functionally complete but is no longer receiving feature updates. Microsoft announced that it would be consolidated with the modern OneNote application. Organizations should not plan new deployments around OneNote for Windows 10.
Microsoft Loop is a new collaborative canvas platform designed for modern, agile work. It complements OneNote and is being positioned as the future of collaborative note-taking and information sharing. Key differences:
Loop is included in E3 and E5 plans at no additional cost. It is not a replacement for OneNote—it is a complementary product for different use cases (real-time collaboration on tasks, agendas, and lightweight content vs detailed note archives).
When a Teams team is created, a OneNote notebook tab can be added to any channel. The notebook lives in the team's SharePoint site and consumes SharePoint storage, not additional storage. No additional licence is required.
OneNote tabs in Teams:
Education has three OneNote-related tools for classroom collaboration:
A teacher creates a Class Notebook, which automatically generates student folders within the notebook. Features:
Similar to Class Notebook but for staff/teacher collaboration. Teachers and administrators can create shared notes and resources.
Office 365 Education (and Microsoft 365 Education plans) include OneNote as part of the bundle. There is no separate charge. Schools purchasing Office 365 A3 or A5 get full OneNote access for students and faculty.
Important: Office 365 Education plans have generous storage (1 TB per student, unlimited for A5). OneNote deployment in education often involves large shared notebooks with extensive student contributions, so A5 plans (unlimited storage) are common for comprehensive programmes.
The modern OneNote application is available on both macOS and Windows. Microsoft has invested in feature parity between platforms:
There is no separate licence for OneNote on Mac. If a user has an M365 licence, they can install OneNote on both Windows and Mac computers. Older versions (OneNote 2016) are out of support but still functional.
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View Advisory Services →OneNote notebooks inherit permissions from their storage location:
These governance features do not change OneNote licensing—they are included in all M365 plans.
Both OneNote and Loop are included in E3/E5 plans. How do you choose?
Loop is not a replacement for OneNote—they serve complementary purposes. E3/E5 organisations get both and should deploy them contextually.
False. OneNote is included in all M365 commercial plans at no additional cost. If a salesperson suggests OneNote is a paid add-on, they are mistaken.
Outdated. OneNote for Windows 10 is deprecated. The modern OneNote (available in the Microsoft Store and in Microsoft 365) is the strategic product. New deployments should target the modern version.
Not exactly. OneNote storage is subject to OneDrive and SharePoint allocations (1 TB per user for E1/E3, unlimited for E5). OneNote notebooks consume storage alongside email, files, and other content.
No. Loop is a new, lightweight collaborative canvas. OneNote is a mature hierarchical note-taking system. They are complementary, not identical.
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Request a Consultation →When deploying OneNote enterprise-wide, consider these best practices:
OneNote has zero impact on EA pricing. It does not add cost to any M365 plan. The cost considerations are:
Bottom line: Do not negotiate OneNote pricing. It is bundled at no additional cost. Focus EA negotiations on M365 tier pricing (E1, E3, E5), CAL seats, and support levels.
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Download Free Guide →OneNote is included in all Microsoft 365 commercial plans—E1, E3, E5, and Business tiers—at no additional cost. There is no separate licence to purchase. Version confusion (legacy OneNote for Windows 10 vs modern OneNote) should be resolved by deploying only the modern version. OneNote storage consumes OneDrive and SharePoint allocations, so E5 (unlimited) may be justified for organizations with heavy collaborative note-taking.
Microsoft Loop is a complementary new product for lightweight, real-time collaboration and is included in E3+ plans. OneNote and Loop serve different purposes and should be deployed contextually.
For EA renewal discussions, OneNote has no negotiation points—it is bundled at zero cost. Focus negotiation on M365 tier pricing and storage allocations.