Microsoft Entra ID Free, P1, and P2: What’s the Difference and Which One Do You Need?

If you’re diving into Microsoft Entra ID (formerly Azure AD), you’ve likely come across its different licensing tiers: Free, Premium P1, and Premium P2. With various options, it can be tricky to know which one is best suited for your organization. Let’s break it down, exploring what each version offers, the differences, and why you might choose one over the other.

Entra ID Free: The Basics

Entra ID Free is a great starting point for small businesses or organizations with simpler needs. This tier offers the essential tools for managing identities and access without any cost.

What You Get with Entra ID Free:

  • User and group management: Manage who’s in your organization and assign them to specific groups.
  • Single Sign-On (SSO): Users sign in once and gain access to multiple Microsoft services (like Office 365) and supported third-party apps.
  • Basic Multi-Factor Authentication (MFA): Add an extra layer of security by requiring users to authenticate using a second factor (e.g., phone, app, or biometric).
  • Self-Service Password Reset (for cloud users): Let cloud users reset their passwords on their own, freeing up IT resources.
  • Device registration: Users can register their devices to access corporate resources more securely.
  • Security Reporting: Get insights into risky sign-ins and suspicious activity to detect potential threats.
  • Azure AD Join: Users can connect their Windows devices to Azure AD for centralized management.
  • Azure AD Connect: This free tool allows you to sync on-premises Active Directory with Azure AD, enabling a hybrid identity environment. Basic sync, such as syncing users and passwords, is available with the Free tier.
  • Global Blocked Password List: Microsoft maintains a list of weak passwords that are automatically blocked.

Why Entra ID Free is Great:

  • It’s free: Perfect for small businesses that don’t need advanced features.
  • Core functionality: Provides essential security tools like SSO, MFA, and Azure AD Connect to enable basic hybrid identity management.

Included with Microsoft 365 Plans:

  • Business Standard: Entra ID Free is included, giving you basic identity management but lacking the advanced features of the Premium tiers.

Entra ID Premium P1: Stepping Up Your Security Game

As your business grows and your security needs become more complex, Entra ID Premium P1 offers the advanced tools you’ll need. P1 includes everything from the Free tier, but with additional security features like Conditional Access and dynamic groups, giving you better control over who accesses what, and from where.

What You Get with Entra ID P1:

  • All Free Tier Features: Everything from the Free plan, plus more.
  • Conditional Access: This is a key feature. You can set up policies that grant or block access based on certain conditions—like location, device, or user status. For example, if someone logs in from an unfamiliar device or risky location, Conditional Access can prompt for additional authentication or block access.
  • Self-Service Password Reset (for On-Premises Users): Users with on-premises accounts can reset their passwords without IT’s help.
  • Dynamic Groups: Automatically adjust group memberships based on user attributes (like department or location).
  • Azure AD Connect: This tool remains free with Entra ID Premium P1. However, advanced features like password writeback (allowing users to reset their passwords in the cloud and have changes reflected on-premises) require a P1 license.
  • Custom Blocked Password Lists: You can create a custom list of banned passwords (in addition to the global one) to prevent users from choosing weak or predictable passwords.

Why P1 Might Be Right for You:

  • More control: Conditional Access gives you the flexibility to secure access based on various conditions like location or device type, ensuring stronger security without compromising usability.
  • Hybrid identity with advanced sync features: While Azure AD Connect is free for syncing users and groups, features like password writeback or group writeback are only available with Premium P1, making it a must-have for hybrid identity management.
  • Custom password protection: P1 allows you to enhance password security by blocking weak passwords tailored to your organization’s needs.

Included with Microsoft 365 Plans:

  • Microsoft 365 E3: Comes with Entra ID Premium P1, providing access to advanced security features like Conditional Access, dynamic groups, and custom blocked password lists.
  • Microsoft 365 Business Premium: Also includes Entra ID Premium P1, offering small to medium-sized businesses access to advanced security without the higher costs of an E3 or E5 plan.

Why Conditional Access with MFA is a Big Improvement Over Basic MFA

Multi-Factor Authentication (MFA) is already a great way to enhance your organization’s security by requiring users to provide a second form of identification beyond just a password. But Conditional Access with MFA takes this protection to a whole new level.

1. Contextual Security Based on Real-Time Conditions

Basic MFA prompts users for an additional authentication step. That’s great for security, but it can get annoying for employees who are always logging in from trusted locations and devices. Conditional Access with MFA, on the other hand, only triggers MFA when it’s necessary.

  • For example, if someone is logging in from a known device and a trusted location, they may not be prompted for MFA. But if the same user suddenly tries to access resources from a new country or an untrusted device, MFA can be enforced.

This context-aware approach makes your security more intelligent and reduces the friction for users, only stepping in when there’s a real need to verify their identity.

2. Protects Against More Sophisticated Attacks

Basic MFA protects against common attacks like phishing or credential stuffing, where attackers might steal usernames and passwords. But cybercriminals are getting smarter. They may try to bypass MFA using tactics like man-in-the-middle (MITM) attacks, where they intercept communication between the user and authentication system, or they might try to access your resources from trusted networks to avoid detection.

Conditional Access lets you enforce stricter security policies based on real-time risk factors. For example:

  • If a user’s credentials have been flagged as compromised or they’re attempting to sign in from a high-risk country, Conditional Access can either block access outright or require additional verification.
  • Risk-based Conditional Access (available with Entra ID Premium P2) even analyses things like impossible travel (logging in from two distant locations within minutes) and adapts security policies automatically.

3. Granular Access Control

Conditional Access lets you set precise policies based on factors like:

  • Location: You can block or require MFA for logins from specific locations (like certain countries or unknown IP addresses).
  • Device: You can allow or deny access depending on whether the device is registered, compliant, or up to date.
  • Applications: For especially sensitive apps (like financial systems or data management tools), you can enforce more stringent Conditional Access rules, like always requiring MFA.

With basic MFA, you’re asking for that second factor of authentication every time. With Conditional Access, you can fine-tune these rules to give you greater control over how users access different parts of your system.


Entra ID Premium P2: Top-Tier Security for Big Organizations

If your organization handles highly sensitive data or operates in a heavily regulated industry, Entra ID Premium P2 is your best bet. P2 adds even more advanced security and identity governance features to give you peace of mind.

What You Get with Entra ID P2:

  • All P1 Tier Features: Everything from P1, plus more advanced tools.
  • Identity Protection: Automatically detects and mitigates identity-based risks, such as compromised credentials or risky sign-ins.
  • Privileged Identity Management (PIM): Control and monitor access to sensitive roles. You can assign admin privileges temporarily, only when necessary, reducing the risk of unnecessary access.
  • Risk-Based Conditional Access: This takes Conditional Access a step further by dynamically responding to the risk level of each login attempt. For example, if a login from an unusual location is detected, it can require additional authentication or block the user altogether.
  • Access Reviews: Regularly review user access to resources to ensure they still need it—helpful for compliance.
  • Just-in-Time Access: Ensure users only get access to critical resources when they absolutely need it, reducing the chance of misuse.
  • Custom and Global Blocked Password Lists: Like P1, you can define custom blocked passwords, while also using Microsoft’s global blocked password list for added protection.

Why P2 is a Must for Larger Organizations:

  • Top-level security: If you deal with sensitive data or need to meet strict compliance standards, P2 offers the most robust security features.
  • Identity governance: P2 helps you stay compliant by ensuring the right people have the right access, and only when they need it.

Included with Microsoft 365 Plans:

  • Microsoft 365 E5: Includes Entra ID Premium P2, offering the full suite of features, including Identity Protection, Privileged Identity Management, and risk-based Conditional Access.

Recommendation: P2 Licenses for Executives and Global Admins

While Entra ID Premium P2 is great for any organization with high-level security needs, I strongly recommend P2 licenses for certain key roles, such as global administrators and executives. Here’s why:

1. High-Risk Accounts Are the Biggest Targets

Executives and global admins often have elevated permissions and access to the most sensitive data and resources in the organization. These high-level accounts are frequent targets for cyberattacks, including phishing and credential theft. P2’s advanced security features—like Privileged Identity Management (PIM) and Risk-Based Conditional Access—help ensure these accounts remain secure even under heightened threat scenarios.

2. Privileged Access Should Be Temporary

Executives and admins often require privileged access, but these permissions don’t need to be active all the time. With Just-in-Time Access, you can grant high-level access temporarily, limiting the risk window for attackers.

3. Proactive Risk Detection and Response

Executives often log in from various locations and devices, which can introduce security risks. With Risk-Based Conditional Access, P2 automatically adjusts access rules based on factors like the user’s behaviour, location, or device security. This ensures that high-value accounts are always protected, even when the risk level changes.

For these reasons, upgrading your key users to Entra ID Premium P2 provides an added layer of protection for your most valuable accounts.


Wrapping It Up

Microsoft Entra ID offers something for everyone, whether you’re a small business needing basic security or a large enterprise looking for advanced identity protection. The key is understanding your organization’s specific needs and matching them to the right Entra ID tier.

For companies looking to tighten security around executives or users with global access, we highly recommend going with Entra ID Premium P2. The advanced features, especially when combined with a Zero Trust approach, give you robust protection without sacrificing usability.

Enhancing Security with Azure Key Vault and Automated Password Rotation

Introduction

In the digital age, safeguarding your digital assets has never been more critical. Static passwords, especially when reused across multiple platforms, present a significant security risk. This blog post delves into how Azure Key Vault and automated password rotation can drastically reduce this risk, securing your environment against potential threats.

The Perils of Static Passwords

The use of a single password across your environment can significantly amplify the risk of cyber attacks. This practice not only increases your attack surface but also simplifies the job for cyber attackers, making it easier for them to compromise your systems.

Overview: Setting the Stage for Security

To embark on enhancing your security with automated password rotation, you’ll need the following Azure components:

  • Virtual Machine: For demonstration, a Windows 2019 VM deployed in Azure.
  • Azure Key Vault: Acts as the secure vault for your automated password secrets.
  • Automation Account: Hosts the runbook that will manage the password update process.

I’ll skip the details of setting up a virtual machine, assuming everyone is familiar with this process.

Azure Key Vault: Centralizing Digital Security

Azure Key Vault stands out as a pivotal tool in managing and securing digital secrets, including passwords. It centralizes the management of secret keys, reducing the chances of unauthorized access and exposure.

Setting Up Azure Key Vault

  1. Navigate to the Azure Portal: Log in to your account.
  2. Create a Key Vault: Search for “Key Vault” in the marketplace and fill in the necessary details like name, region, and resource group.
  3. Access Configuration: Under permissions, select “Vault Access Policy.” For Resource Access, choose “Azure Virtual Machines for deployment.”
  4. Managing Secrets: After creation, go to the “Secrets” section. Click “+ Generate/Import” to create a secret for the VM password. Add both a name and the secret value.

Automating Password Rotation: A Step-by-Step Guide

Automated password rotation is crucial for maintaining security, particularly for sensitive roles. Below is a PowerShell script tailored for Azure environments to automate this process, utilizing Azure Key Vault for secure password management.

Configuring Azure Automation

  1. Create an Automation Account: In the Azure Portal, create a new Automation Account, specifying the same subscription and, optionally, the same resource group as your Key Vault.
  2. Advanced: Under the advanced section ensure “System Assigned” identities is ticked, complete the creation of the Automation Account.
  3. Import Necessary Modules: Your Automation Account needs specific modules to interact with VMs and Key Vault. Ensure you import Az.Accounts, Az.Compute, and Az.KeyVault modules. Navigate to your Automation Account, select “Modules” under “Shared Resources”, and add these modules if they’re not already present.

Setting Permissions and Preparing the Runbook

After configuring the essential components, it’s crucial to establish the correct permissions to ensure secure and seamless operation between your Azure services.

Assigning Necessary Permissions

  1. Virtual Machine Access: Grant the “Virtual Machine Contributor” role to the Automation Account which will allow it management capabilities over the virtual machine.
  2. Enabling Automation from VM: Within the Virtual Machine’s security settings, locate the “Identity” option. Assign the “Automation Contributor” role to the Virtual Machine itself, enabling it to interact efficiently with the Automation Account.
  3. Securing Key Vault Access: Go to your Azure Key Vault and access the “Access Policies” section. Here, you’ll add a new policy. Ensure it includes “Get,” “List,” and “Set” permissions for secrets, and assign this policy to your Automation Account. This step is pivotal in securing and managing access to the passwords stored within the Key Vault.

Crafting the Runbook

With permissions in place, the next action is to create a runbook within your Automation Account. This runbook will be the engine behind the automated password rotation, executing the necessary scripts to update and secure your environment.

  1. Initiate Runbook Creation: In the Automation Account dashboard, look for the option to create a new runbook. Click on this to start the setup.
  2. Configure Runbook Settings:
    • Name: Assign a distinctive name to your runbook, making it easily identifiable.
    • Runbook Type: Select “Powershell” as the type, aligning with the scripting language of our automation script.
    • Runtime Version: Opt for the latest stable version, 7.2, to ensure compatibility and leverage the latest features.
    • Description: Provide a brief yet descriptive summary of the runbook’s purpose and its role in the password rotation process.

Script for Automated Password Rotation

The new automated password will be a 16 character alphanumeric password contains numbers, letters, and special characters.

# Authenticate using Managed Identity
Connect-AzAccount -Identity

# Define variables for your environment
$resourceGroupName = "YourResourceGroupName" # Your VM's resource group
$vmName = "YourVMName" # Your VM's name
$vaultName = "YourKeyVaultName" # Your Key Vault's name
$secretName = "YourSecretName" # Your secret's name for storing the VM password
$location = "YourVMLocation" # Your VM's location
$username = "localadmin" # The VM's admin username (change if different)

# Function to generate a new password
function Generate-Password {
param ([int]$length = 16)
$characters = 'ABCDEFGHIJKLMNOPQRSTUVWXYZabcdefghijklmnopqrstuvwxyz0123456789!@#$%^&*()'
$securePassword = New-Object System.Security.SecureString
1..$length | ForEach-Object {
$char = $characters[(Get-Random -Maximum $characters.Length)]
$securePassword.AppendChar($char)
}
return $securePassword
}

# Generate a new password and convert it to plaintext for VM extension
$securePassword = Generate-Password
$plaintextPassword = [Runtime.InteropServices.Marshal]::PtrToStringAuto([Runtime.InteropServices.Marshal]::SecureStringToBSTR($securePassword))

# Update the VM's local administrator password
try {
$protectedSettings = @{ "username" = $username; "password" = $plaintextPassword }
Set-AzVMExtension -ResourceGroupName $resourceGroupName -VMName $vmName `
-Location $location -Name 'VMAccessAgent' `
-Publisher 'Microsoft.Compute' -ExtensionType 'VMAccessAgent' `
-TypeHandlerVersion '2.4' -ProtectedSettings $protectedSettings
Write-Output "VM Access Extension set successfully."
} catch {
Write-Error "Failed to set VM Access Extension. Error: $_"
}

# Store the new password in Azure Key Vault
try {
$secretValue = ConvertTo-SecureString -String $plaintextPassword -AsPlainText -Force
Set-AzKeyVaultSecret -VaultName $vaultName -Name $secretName -SecretValue $secretValue
Write-Output "Key Vault secret updated successfully."
} catch {
Write-Error "

}

Ensure to replace the placeholder values with your actual environment details before running the script. This script automates the process of generating a secure password, updating the VM’s password, and securely storing the new password in Azure Key Vault.

Finalizing and Executing Your Automation Strategy

With your runbook configured and ready, the next steps involve saving your work, publishing the runbook, and initiating the password rotation process. These actions represent the culmination of your efforts to enhance your system’s security through automation.

Saving and Publishing the Runbook

  1. Save Your Work: After entering the script and configuring the runbook, ensure you save your progress. This action preserves the script for future adjustments or reviews.
  2. Publish the Runbook: Publishing makes your runbook active and ready for execution. This crucial step transitions your runbook from a draft to a live script capable of automating the password rotation process.

Executing the Runbook

  • Run the Runbook: Initiate the runbook to start the automated password rotation. This process will generate a new password, apply it to your virtual machine, and update the Azure Key Vault with the new password secret.

Monitoring Execution and Outputs

Upon running the runbook, monitor its execution status. Successful completion will be indicated by a ‘Completed’ status, confirming the password rotation has been effectively carried out.

  • Successful Execution: A ‘Completed’ status assures that the automated process has successfully updated the VM’s password and stored the new credential in Azure Key Vault without issues.
  • Troubleshooting Failures: If you encounter a ‘Failed’ status, it may be necessary to revisit the script and check for any inaccuracies in the placeholder variables or configuration settings. Ensuring all specified values accurately reflect your Azure environment is critical for a successful automation process.

Automating for Consistency

For full automation and to ensure continuous security enhancement, you can schedule the runbook to run on a scheduled basis. This step allows you to automate the password rotation process completely, ensuring that your virtual machine’s password is regularly updated without manual intervention.

Retrieving Your Updated Password from Azure Key Vault

  1. Navigate to Azure Key Vault: First, log into your Azure Portal and go to the Azure Key Vault that you’ve used to store the secret (the password).
  2. Access the Secrets Section: Inside your Key Vault, locate and click on the “Secrets” section found on the panel. This section lists all the secrets that your Key Vault is managing.
  3. Find Your Secret: Look for the secret name you designated for storing the VM’s password. This name was specified when you set up the Key Vault and the automation script.
  4. View the Secret Version: Click on the specific secret associated with your VM’s password. You may see multiple versions if the password has been rotated more than once. Each version corresponds to a password change, with the latest version representing the most current password.
  5. Show Secret Value: To view the password, select the latest version of the secret and then click on the “Show Secret Value” option. This action will reveal the password so that you can use it to access your VM or for other necessary purposes.

Conclusion: Elevating Security Through Automation

In an era where digital security breaches are not just probable but inevitable, taking proactive measures to safeguard our digital assets becomes paramount. Through the integration of Azure Key Vault and automated password rotation, we’ve explored a powerful strategy to enhance security infrastructure, making it more resilient against potential cyber threats. This approach not only mitigates the risk associated with static passwords but also aligns with best practices for identity and access management in the cloud.