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Microsoft Defender for Identity vs Microsoft Entra External ID comparison

 

Comparison Buyer's Guide

Executive Summary

Review summaries and opinions

We asked business professionals to review the solutions they use. Here are some excerpts of what they said:
 

ROI

Sentiment score
5.7
Microsoft Defender for Identity improves incident management, reduces costs, enhances ROI, and saves time despite unclear financial benefits.
Sentiment score
5.3
Microsoft Entra External ID simplifies identity management despite integration challenges and higher costs, offering time benefits and potential savings.
It has led to cost savings as well as time savings because I can use a single solution for all applications.
Companies can leverage it for setting up external identities without needing to develop their own solutions.
In terms of return on investment, prior to using this product, our company managed our own mail server with all internal authentication happening on premises, resulting in a ROI in the thousands every year.
 

Customer Service

Sentiment score
8.5
Microsoft Defender for Identity's support receives mixed feedback, with users praising premium service but noting poorer lower-tier support responses.
Sentiment score
5.3
Microsoft Entra External ID support receives mixed feedback, with response times, expertise, and accessibility varying across user experiences.
Generally, the support is more effective than other providers like Oracle.
The quality of support is very good, but troubleshooting can take time due to complex setups and the need to provide many logs.
Companies without a Microsoft license for Entra ID or Azure portal cannot add Azure AD B2C, creating logistical issues for some of my clients who are unable to evaluate the platform.
The support for business applications, infrastructure support, and Entra has been mostly positive with highly skilled technicians.
The documentation is very thorough, reducing the need for support.
 

Scalability Issues

Sentiment score
8.5
Microsoft Defender for Identity is scalable, efficiently supports large networks, and integrates well into Microsoft-centric environments with minimal effort.
Sentiment score
7.7
Microsoft Entra External ID is scalable and useful for large companies, but lacks customizable authentication and faces cloud latency.
In a Microsoft-centric organization, especially with Azure infrastructure and Office 365, Microsoft Defender for Identity is scalable.
This is one of EID's weak points compared to Azure AD B2C, which offers customizable authentication options, including attribute and password combinations.
End-user workloads experience increased latency in a cloud environment compared to on-premises resources.
Microsoft Entra External ID is quite scalable, and I would rate its scalability between eight and nine out of ten.
 

Stability Issues

Sentiment score
7.5
Microsoft Defender for Identity is stable and reliable, though occasional sensor restarts occur, generally scoring 6-9/10 in stability.
Sentiment score
7.3
Microsoft Entra External ID is highly stable and reliable, with users praising its performance and SaaS-only simplicity.
Microsoft Defender for Identity is quite robust and built on Azure hyperscale infrastructure, with a 99% availability.
We do not see any issues with the stability of Microsoft Defender for Identity.
Having recently started using it, reliability is affirmed, but manual investigation is often performed to verify if alerts identified by auto-remediation are accurate.
The stability of this solution is very good.
I have not encountered any stability issues with Microsoft Entra External ID.
Unless such major incidents occur, it is stable and reliable.
 

Room For Improvement

Microsoft Defender for Identity needs better integration, usability, and support, with improved detection and cost efficiency highlighted by users.
Microsoft Entra External ID needs improved synchronization, cost transparency, support, software integration, alerting, security, and customization features.
If Microsoft could develop a feature that indicates when impossible travel is caused by VPN connections, it would prevent unnecessary password resets and session disruptions, especially for VIP users in organizations.
One improvement I would recommend is the integration of an admin application within Teams, allowing easy access to attack information on a mobile platform.
Reducing false positives is something we've been working on with Microsoft.
This is particularly challenging during enterprise agreement renewals, as it's difficult for customers to review costs leading to lengthy negotiations.
Enhanced customizable login options and the ability to use attribute password logins are critical features that are required for Microsoft Entra External ID to gain dominance in the authentication market.
I would like to see a more detailed alert system that provides a summary of why alerts are generated, who is generating them, and the reasons behind it.
 

Setup Cost

Microsoft Defender for Identity is cost-effective within E5, offering flexibility compared to standalone purchases or E3 add-ons.
Microsoft Entra External ID's costs escalate with growth, complexity in licensing, and heavy dependency on Azure pricing structure.
If they can reduce the costs, organizations will be happy, and it will compensate for using the Azure environment, which is more expensive on the infrastructure as a service side.
Ensuring a fair price according to market standards.
From an organization perspective, using E5 licenses is value for money, especially if Azure and Office 365 are already in use.
Regarding pricing, the cost seems high for single sign-on, especially for external applications like Oracle.
Microsoft's pricing is complex and difficult to fathom due to a range of different licensing options.
The cost can be a factor for Microsoft Entra External ID, but in general, it offers a scalable and efficient solution compared to deploying individual solutions.
 

Valuable Features

Microsoft Defender for Identity excels in integration, real-time detection, privilege management, AI analytics, and comprehensive security monitoring features.
Microsoft Entra External ID streamlines management with easy setup, integration, and robust security, enhancing efficiency for diverse application needs.
We receive an advance report of risky users, allowing us to take preemptive action before an attack causes damage to organization details.
The most valuable feature is its hybrid artificial intelligence, which gathers forensic data to track and counteract security threats, much like the CSI series in effect.
The advanced threat protection is one of the strengths of Microsoft Defender for Identity, as it utilizes user and entity analytics and can detect indicative attacks.
It is crucial for hybrid environments, especially for integrating existing on-site infrastructures with cloud-based Active Directory, such as in Office 365 implementations.
EID unifies workforce users with external business partners, which is a very strong feature.
Microsoft's reliability in providing a clear roadmap for the solution is very important, especially at a time when cybersecurity is a risk in every company.
 

Categories and Ranking

Microsoft Defender for Iden...
Ranking in Microsoft Security Suite
5th
Average Rating
8.8
Reviews Sentiment
7.3
Number of Reviews
24
Ranking in other categories
Advanced Threat Protection (ATP) (5th), Identity Threat Detection and Response (ITDR) (3rd)
Microsoft Entra External ID
Ranking in Microsoft Security Suite
21st
Average Rating
7.6
Reviews Sentiment
6.3
Number of Reviews
11
Ranking in other categories
Identity and Access Management as a Service (IDaaS) (IAMaaS) (10th), Customer Identity and Access Management (CIAM) (5th)
 

Mindshare comparison

As of July 2025, in the Microsoft Security Suite category, the mindshare of Microsoft Defender for Identity is 6.9%, up from 6.7% compared to the previous year. The mindshare of Microsoft Entra External ID is 0.9%, up from 0.3% compared to the previous year. It is calculated based on PeerSpot user engagement data.
Microsoft Security Suite
 

Featured Reviews

ROBERT-CHRISTIAN - PeerSpot reviewer
Integration within the ecosystem enhances collaboration and automates functionalities
The integration into the Microsoft Defender ecosystem is the most valuable feature of Microsoft Defender for Identity. It fits very nicely with all the other Defender tools, allowing for excellent collaboration among them. It also fits seamlessly into Microsoft Sentinel SIEM. Furthermore, Microsoft security solutions can save time as they allow the automation of numerous functionalities, and the reporting inside the Microsoft ecosystem is commendable.
Corrado Vigano - PeerSpot reviewer
Solution integrates well with existing systems while being easy to use
The fact that it is quite integrated into the entire Microsoft environment makes it quite easy to use. Furthermore, Microsoft's reliability in providing a clear roadmap for the solution is very important, especially at a time when cybersecurity is a risk in every company. The solution is easy to reuse and not difficult to find expertise for in the market because it is widespread. It is gaining attention even from partners and from the market on the offering side. This serves as a good starting point for customers who can develop internal competence on the solution. Additionally, the presence of reliable partners who know the solution and can provide internal knowledge is the best aspect for them.
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Top Industries

By visitors reading reviews
Computer Software Company
15%
Financial Services Firm
13%
Government
7%
Manufacturing Company
7%
Computer Software Company
17%
Manufacturing Company
11%
Financial Services Firm
11%
Government
8%
 

Company Size

By reviewers
Large Enterprise
Midsize Enterprise
Small Business
 

Questions from the Community

What do you like most about Microsoft Defender for Identity?
Microsoft Defender for Identity provides excellent visibility into threats by leveraging real-time analytics and data intelligence.
What needs improvement with Microsoft Defender for Identity?
For improvement, I need to complete the testing. We are currently in the initial phase. Improvement insights will be shared post the thorough testing phase. We have just started using it a month ag...
What is your primary use case for Microsoft Defender for Identity?
We are performing testing under Microsoft Defender for Identity ( /products/microsoft-defender-for-identity-reviews ). The implementation is very recent, as we started using it about a month ago.We...
What is your experience regarding pricing and costs for Microsoft Entra External ID?
The cost totally depends on Azure's pricing structure. If you have sufficient background knowledge about the features and functionality, it can be cost-effective. However, if you need support or as...
What needs improvement with Microsoft Entra External ID?
Integration could be improved when it comes to legacy tools.The support engineers are not as skilled as our engineers. When they say something would not work, or there is no solution, we usually he...
What is your primary use case for Microsoft Entra External ID?
Currently we use some of the AWS ( /products/amazon-aws-reviews ) solutions and Google Solutions and few of Alibaba Cloud ( /products/alibaba-cloud-reviews ). That totally depends on time to time a...
 

Also Known As

Azure Advanced Threat Protection, Azure ATP, MS Defender for Identity
Azure Active Directory External Identities
 

Overview

 

Sample Customers

Microsoft Defender for Identity is trusted by companies such as St. Luke’s University Health Network, Ansell, and more.
Information Not Available
Find out what your peers are saying about Microsoft Defender for Identity vs. Microsoft Entra External ID and other solutions. Updated: June 2025.
860,592 professionals have used our research since 2012.