Microsoft recently announced the first Microsoft 365 price changes alongside an updated subscription platform (New Commerce Experience) with new commercial terms. From March 1, 2022:
Six commercial products will see an average increase of 10%. Affected products (US RRP for annual term) are:
- Microsoft 365 Business Basic (from $5 to $6)
- 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)
UK pricing will be provided as soon as it is released.
No other products are affected, including education and charity products.
New Commerce Experience (NCE)
New subscriptions will have the following terms:
- The minimum 12-month term of annual subscriptions will be enforced
- Subscriptions with a monthly term will incur a 20% uplift on annual prices
- A new 36-month term will be available for some subscriptions
Existing subscriptions will have a 3-4 month grace period but will need to be switched to NCE before the end of June 2022.
We will be contacting each client to agree the best option, but our recommendations are:
- Clients should choose the 12-month term subscriptions for best pricing – this can still be paid monthly or annually
- For organisations where staff numbers change regularly, the majority of licenses should be purchased on the 12-month subscription, with a minority on the 1-month subscription for flexibility
The Microsoft 365 (formerly Office 365) services have now been operating for more than a decade without any change to pricing despite very significant additional functionality and features.
Despite this, the price rises only affect the six commercial products listed above and no other products are affected, including education and charity products.
We will confirm the exact UK/GBP pricing as soon as it is available.
Your most recent GSL invoice contains details of your current subscriptions and pricing.
- From 1/March/2022, revised pricing will affect existing and new subscriptions for the six affected products
NCE has now been launched and from 1/March/2022 will affect all new M365 subscriptions.
Current subscriptions have a 12-month term, but as this has never been enforced, subscriptions have allowed to be operated monthly.
However, as with the static pricing for the last 10 years, Microsoft have made no changes to their terms despite the significant changes in IT and commerce. With NCE, Microsoft are bringing their terms in line with other major subscription services like Netflix, Google, Apple etc.
The current 12-month fixed price subscriptions will continue, but the term will now be enforced. Subscriptions may be upgraded but not downgraded or cancelled during the term.
Microsoft have launched a 1-month subscription for those needing a shorter term, but this additional flexibility will incur a 20% premium on the annual subscription monthly price. However, subscriptions can be downgraded or cancelled with just one month’s notice.
A 36-month subscription is also being introduced – at the same price as the 12-month term cost, but it will instead be fixed for the full 36 months.
Subscription terms can be mixed as well as moved between users.
- From 1/March/2022 all new subscriptions will be NCE
- From 1/July/2022 all existing subscriptions will be converted to NCE