Microsoft Price Increase 2025
Microsoft has announced some important updates to Microsoft license pricing and billing options, effective April 1, 2025.
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Upcoming price changes to Microsoft licensing.
Effective from the 1st April 2025, Microsoft will change the monthly billing option for customers who have signed annual contracts for services like Microsoft 365, Windows 365, Power Platform, and others which will see this option increase by 5% over the current price.
There will be three pricing options going forward, with different pricing points:
Monthly Commit / Monthly Payment: 20% increase over RRP (no change)
Annual Commit / Monthly Payment: 5% increase over RRP (this has changed)
Annual Commit / Annual Payment: RRP (no change)
If your licenses renew before April 1, 2025, you can offset these changes until your next renewal in 2026, should you wish to stay on annual commit, monthly payments.
If you’re currently on a monthly payment plan, with an annual commitment, switching to an annual payment plan could help you avoid the higher costs should your renewal come after April 1, 2025.
Customers who take no action will have an automatic increase to their payment (if on annual commit, monthly payment) and renew after April 1, 2025.
Important Updates.
Flexible Billing Options for Microsoft 365 Copilot
Starting December 1, 2024, Microsoft will offer a new flexible billing option for annual Microsoft 365 Copilot subscriptions, allowing customers to pay monthly instead of upfront. This option will be available at a 5% premium over annual payment options, supporting businesses that need budget flexibility without sacrificing access to Microsoft 365’s AI capabilities.
Changes to Microsoft Teams Phone Standalone Pricing
Pricing for standalone Microsoft Teams Phone subscriptions will increase to reflect the enhanced capabilities introduced in Teams Phone. However, Microsoft 365 E5 license holders will not see changes in their current setup.
Important Update to Microsoft Power BI Pricing
Further announcements to changes in the pricing structure for Microsoft Power BI Pro and Premium Per User (PPU) licenses:
- Power BI Pro licenses: USD 14 (approx. £11, up from £8.20) per user per month
- PPU licenses: USD 24 (approx. £19, up from £16.40) per user per month
The increases will apply globally to new and existing commercial customers upon renewal as of April 1, 2025, with comparable pricing in other currencies. These prices are also subject to the 5% increase for monthly payments with annual commitments.
Please note that official UK pricing is not yet available, and conversions to GBP are for indication purposes only.
What These Updates Mean for You?
We understand the frustration with recent announcements and encourage you to get in touch with us to get ahead of the curve and make the necessary amends upon renewal. These updates are aimed at giving you more flexible payment options and clearer pricing structures for planning your Microsoft 365 services.
Arrow Business Communications Ltd.
