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How Much Does Active Directory Cost?

By Jake Turner on 11/25/25

Description: Considering implementing Active Directory but worried about hidden costs? We'll break it down here!

So, you're thinking about running Active Directory in your environment, but you're not sure what investment is required? Here's the good news: Active Directory is free with any valid Windows Server license. There is absolutely zero cost to install Active Directory Domain Services and promote a Windows Server to a domain controller.

Of course, running a production-ready Windows Server requires some investment in server hardware (and/or licensing if not included with your server), but the full features of Active Directory are available at no additional cost.

What's the catch?

Well, there isn't one! For traditional, on-premises Active Directory deployments, there truly is no cost to run this awesome suite of software, aside from the initial investment in a reliable server. However, if you want to start bridging this setup into the cloud to integrate with other SaaS offerings and/or device management tools like Microsoft Intune, that's where some costs may come into play.

This cloud suite is known as Microsoft Entra ID, and it enables you to sync users and devices to the cloud, integrate with business apps, setup cloud-based Exchange, and more. Technically, Entra does offer a free plan, but you should know that it is fairly limited in features and likely won't be suitable for larger businesses. These advance features, like Conditional Access and self-service password resets, will require licensing for either Entra ID Plan 1 or Entra ID Plan 2. We encourage you to check out our article Do I need Entra P1 or P2 for more information

If you need additional help finding the right licensing for your business, or you're looking to buy at discounted rates, contact Cosmistack today! We look forward to working with you!

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Disclaimer: The information provided in this article is for educational and informational purposes only. The techniques, tools, and technologies discussed are intended to be used by individuals with a solid understanding of the subject matter. Readers are entirely responsible for any actions they take based on the content of this article. This blog and its authors do not assume any responsibility for any unintended outcomes, data loss, or issues that may arise from following the instructions or recommendations provided.