Microsoft 365

Price increases of up to 20 per cent will take effect from 1st March 2022

Microsoft will be increasing prices for its suite of popular Microsoft 365 products. The increases, of up to 20%, will affect business customers and will take effect within six months from March 2022. This was first mentioned in this article in August 2021

The Microsoft 365 cloud software suite combines what was formerly known as Office 365 and Windows 10 with EMS (Enterprise Mobility + Security), Teams and its other applications.

Which 365 plans will be affected and by how much?

The basic business plan will see a rise of 20%, from $5 per user to $6, while the high-end Microsoft 365 E3 will increase by 12.5%, from $32 to $36 per user. Equivalent pound sterling currency increases apply at the same rate as well.

The following Microsoft Office 365 plans will also see an increase in price:

  • Microsoft 365 Business Premium (from $20 to $22)
  • Office 365 E1 (from $8 to $10)
  • Office 365 E3 (from $20 to $23)
  • Office 365 E5 (from $35 to $38)
  • Microsoft 365 E3 (from $32 to $36)

This increase is for 1,2 and 3 year commitments, if you want to keep on a month by month contract there is an extra 20% fee on top.

The price changes will apply globally, with local market adjustments for certain regions. As stated, the price increases will take effect from 1st March 2022 but will not include consumer or educational products.

Why is Microsoft increasing the price for 365?

Microsoft justified their decision for this increase by saying it was their first “substantive” cost change from the company since launching Office 365 over 10 years ago.

And that “this updated pricing reflects the increased value we have delivered to our customers over the past 10 years,” according to Jared Spataro, Corporate Vice President for Microsoft 365.

Jared Spataro stated that Microsoft had added more than two dozen new apps to the suite of products since it was first introduced, including Teams, which is extremely popular, widely used by companies and which experienced a huge increase in use since the beginning of the Covid-19 pandemic. And that use is not set to disappear either.

It was also highlighted the three key areas where Microsoft products have advanced its performance and delivery to its business customers; communication and collaboration, AI and automation and security and compliance.

What’s in the fine print for Microsoft 365 Users

There is several key bits of information that MSP’s are not telling their clients, one thing a lot of MSP’s are not telling users is that as well as a price increase, they are also locked in with their Microsoft 365 provider for the duration of the contract. The 2nd bit of information not mentioned is when in the contract term, you cannot cancel licenses. You can add more, but you cannot cancel them (unless you choose the month by month commitment).

Unfortunately it does mean that we will have to pass on any cost price increases to our customers. It’s not something that we want to do and where possible, we will do our very best to keep costs the same, dependent on the 365 plans that remain the same price from our supplier.

 

Is it time to change MSP’s

Due to the new Commitments Microsoft is imposing, it may be time that you look if your MSP is doing everything it should for your business. By now they should have given you all the facts about the Microsoft changes, so it gives you time to prepare for the changes. It is definitely time to have a Microsoft 365 license review to make sure you are running on the correct licensing and you don’t have any spare licenses just sat around in your account.

If you would like a Microsoft License review please contact us

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