Back in August of 2021, Microsoft quietly announced a few changes coming to the Microsoft 365 program. They gave businesses a healthy six months of notice, and that time has almost expired. Starting in March of 2022, businesses need to be prepared for their Microsoft 365 subscriptions to change in some small ways — and to cost more. Here’s what you need to know about this upcoming change.
The Big Change: Higher Prices
The big piece of news is that Microsoft is raising prices across its various business plans. While no one likes to pay more, the move makes sense: since launching Office 365 back in 2011, Microsoft hasn’t raised pricing even once, despite adding 24 new apps, including Publisher, Stream, Bookings, Power Automate, SharePoint, and its stellar collaboration app, Microsoft Teams.
If you think back to how you interacted with Office back in 2011 and compare it to how you use Microsoft 365 today, you’ll likely see the difference. Microsoft has continued to add features, functions, and entire new categories of apps to its Microsoft 365 suite. It also rolled out collaborative work within core Office apps like Word, Excel, and PowerPoint, something that was sorely needed in our current environment of hybrid work.
So what do those new rates look like? Microsoft has a wide range of business plans, and most of them are getting a bump:
- Microsoft 365 Business Basic (from $5 to $6 per user)
- 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)
These are small per-user per-month bumps, but they do add up. We still believe that Microsoft 365 (or the remaining Office 365 commercial plans) provide great value, especially for businesses relying on Microsoft for their security and compliance needs. For our existing clients using Microsoft 365, we believe the smart move is to stay with Microsoft despite the price increase.
The Less Obvious Change: How Microsoft Sells 365
Microsoft’s August announcement focused on the increased value that Microsoft 365 offers as well as the specifics of the price change. But there’s a less obvious change going on here that you might also want to know about.
Microsoft is also changing the way it sells its 365 suite. Starting in March, you’ll have the ability to commit to a 12-month agreement. You’ll likely get a discount over the monthly price by doing so, and your pricing will be locked in for the duration of the agreement.
If you choose the 12-month agreement, there are some significant limitations. You’ll be able to add seats to your license (which you’ll need to do if you add new staff), but you won’t be able to remove seats and lower your costs.
The other big change to this annual contract is important for current Blue Ridge Technology clients as well as anyone working with a managed IT support company. Under the annual agreement, you won’t be able to move your Microsoft licensing to another IT support company.
Seriously: locking in with Microsoft means you’re locking in with your current IT provider. (Translation: if you’re not thrilled with your current provider, you should talk to us before you sign that annual contract!)
Microsoft also continues to offer a rolling monthly contract, which retains the kind of flexibility most 365 customers are accustomed to. But if you stick with the monthly contract type, rates will be a little higher.
Questions about these changes? Considering making a move to a better IT provider before locking in with Microsoft? Either way, we’re happy to help. Reach us anytime!