Big changes are on the horizon. Since last year’s announcement that Microsoft 365 licence prices will be more expensive from March 2022, we’ve had plenty of time to reflect on their decision. Here are a few reasons why the price increase makes sense.
There’s been plenty of new Microsoft 365 business features
In the last five years (since the last price increase) Microsoft 365 licences have doubled in value. Microsoft have implemented a variety of new apps as well as new features to their current products. From the launch of Teams, and Together Mode, to smaller updates that kept things running – Microsoft has added plenty of value to its licence subscriptions over the past few years.
You save money in the long run
Even after the Microsoft 365 licence increase (which will come into place 15 March 2022 on commercial licences), Microsoft 365 will offer businesses a lot of value for their money. Throughout the pandemic, Microsoft has worked to help businesses to adapt to the “new normal” and build a Modern Workplace.
Thanks to the addition of Planner, many customers have saved money that they were previously investing in tools like Project – providing a net-cost saving already.
What about Microsoft’s New Commerce Experience?
Alongside the 365 licence increase, Microsoft announced a new programme to replace the current CSP model. The NCE will help streamline the product subscription processes. The new changes to note include:
The monthly term offers a price premium for customers who need term and seat-count flexibility.
Annual terms offers with better value are available for stable, long-term customers.
The announcement has several benefits, including the launch of communication credits and new multi-geo capabilities for your Microsoft 365 tenant. But a few areas of the announcement have raised concerns for business owners.
Monthly cost
The recent Microsoft 365 licence increase applies to customers taking out an annual agreement. So it would be reasonable to assume the monthly offer will increase even more.
Currently, there is no price protection for pay monthly customers. Further price increases could therefore become a regular occurrence.
Flexibility
One of the key benefits of cloud computing has always been flexibility. So, some of these changes to the CSP model feel like a step in the wrong direction.
Microsoft now only allows a 72 hour “cool-off” period after purchasing, where users can cancel or change their licence subscription. After this point, if you no longer require certain licences, you’ll still have to pay for them until your agreement has finished. You can add more or upgrade your licences, but you can’t reduce/downgrade.
To conclude…it’s a difficult one
It does feel like the changes favour Microsoft more than the customers, and the goal of creating a “simplified purchasing experience” is creating a lot of confusion. We’ll make sure to keep you updated the moment we get clarity on the new T&Cs.
Are you worried about the impact of the Microsoft 365 licence increase?
Whilst the price changes are unavoidable, you can still work with a Microsoft Gold Partner who provides value and extra discounts at every opportunity.
As a Microsoft Gold Partner, we make sure every discount is passed directly down to the customer. On top of those savings, we also provide a 2% licence discount. Claim 2% off your subscription monthly for as long as we’re allocated the cloud solution provider of your choice.
Secure cheaper Microsoft licences ahead of NCE
Push back the Microsoft Price increase for another 12 months by getting your licences before 15 March. On top of any savings, you’ll receive another 2% off your licensing fees for as long as we’re your CSP.
Update (28 February): Microsoft has granted customers an additional 2 week transitional period to ease into the new pricing model. Therefore, all CSP new commerce transactions for the six commercial Modern Work SKUs listed above that are submitted into the system no later than March 14, 2022, 5 p.m., Pacific Daylight Time (PDT), or 12 a.m. UTC on March 15, 2022, will be invoiced at the February 2022 pricing. Find more details here.
