Microsoft have decided to shake up their pricing and commitment structures for Microsoft 365.

In a nutshell, if you want to continue on a month-by-month billing agreement then your costs will rise by 20%. If you move to an annual commitment, then there will be no price increase (over and above any announced price increase per product). Some products are moving to a mandatory 12month commitment.

Option 1: Purchasing licences on a 12-month agreement.

By purchasing a 12-month agreement you will no longer be able to decrease your licence count below what you originally purchased in those 12 months. The 12-month agreement still allows the flexibility of paying the cost monthly or annually.

By choosing option one for your business, it is important that you are aware that throughout the duration of your 12-month contract you cannot move any current Microsoft licencing over to a new IT Support Provider. Your current Microsoft Support Provider will need to discuss to confirm your 12-month agreement and advise you on any changes.

Option 2: Signing up for monthly rolling contacts.

With a new, monthly rolling contract you can retain the complete flexibility to move your licences up and down when required. With no long-term commitment required for a set number of licences, these flex licences will cost around 20% more of their current rate.

With a 12-month agreement, customers have the opportunity to consume online services on an annual commitment basis, that can be billed monthly or annually, which is down to your preference.

With a price-lock for the duration of the term, customers can benefit from further cost savings and protection against any price increases which are implemented during this 12-month period. During this contract, customers have the ability to increase the number of seats but are unable to reduce these seats again in the same period. Responsibility falls to your IT support provider for your Microsoft licencing during this 12-month subscription. During this time, you will not be able to transfer this responsibility to another IT support provider.

Annual licenced paid upfront or monthly

72 Hours

Increase & uplift licencing type allowed

No price increase

Cost saving and price lock

With the option of a monthly subscription, there is no longer the requirement of annual commitment, but the opportunity to consume Microsoft’s Online Services remains, like a 12-month subscription. Also gaining the added flexibility to change seat count on a month-to-month basis, perfect for customers require making more regular changes. Licences can be adjusted within 72 hours of them being purchased or at the end of a monthly contract. However, the monthly subscription through NCE comes at a premium of an uplift of 20% across all service plans.

Monthly

72 Hours

Increase allowed. Decrease with 1 month notice

20% Price Increase

Flexibility

Microsoft have also announced a price increase to some of their core licences. These will be for Microsoft 365 Business Basic, Microsoft 365 Business Premium, Office 365 E1, E3 and E5, and Microsoft 365 E3. Prices will be increasing between 15 and 30% on these licences.

From March 2022 this new pricing and commitment model will be enforced, with all new and renewing subscriptions requiring to be purchased through the new licencing plan.

From the 1st of March entry to Microsoft EA level will be increased from 500 to 2500 seats, which may mean some changes will need to be made.
Please get in contact with us if you require any further information regarding upcoming price rises.