Microsoft Announces Changes to Licensing and Pricing Structures
Microsoft has announced two upcoming modifications to licensing and pricing structures for online services. These changes will take effect in late 2024 and early 2025, so it’s time to start planning for these new pricing models.
As a Microsoft partner with over 25 years of experience helping organizations select, deploy, manage, and optimize their Microsoft licensing and environments, Cyber Advisors has the expertise to guide you through these changes.
Change #1: A New Monthly Billing Option for Microsoft 365 Copilot
Starting December 1, 2024, Microsoft will introduce an annual subscription term with a monthly billing option for Microsoft 365 Copilot. Currently, the only way to utilize Copilot is via an annual subscription term with an annual billing option, so this new option will allow organizations to opt for more flexible payment terms. However, this new annual term/monthly billing option will be priced at a 5% premium over the existing annual term/annual billing option4.
Change #2: Price Increase for All Annual Term/Monthly Billing SKUs
Effective April 1, 2025, Microsoft will also increase pricing by 5% for all annual term/monthly billing online services SKUs in the program. This is a change from the current model, which bills organizations at the same price regardless of whether they choose annual or monthly payments.
Understanding the Impact on Your Environment and Budget
These changes will require budget adjustments and new purchasing strategies for organizations that have previously selected monthly invoices. For instance, if you’re currently on a monthly billing cycle for Microsoft 365 E3 with 250 users, you could be looking at an extra $5,000 per year. These price increases could also significantly impact your organization’s current and future IT subscription expenditure.
Important Note: Your Renewal Timing Matters!
If your current subscriptions are due before April 1st, these changes will go into effect at your anniversary next year. This only applies to subscriptions being renewed after April 1st.
How Cyber Advisors Can Help
At Cyber Advisors, we understand that navigating changes in licensing and pricing structures can be challenging. Our team of experts is here to develop strategies that minimize the impact on your organization. We can assist in three ways:
- Comprehensive licensing reviews
- Budget planning and forecasting
- Ongoing support and consultation
If you decide to avoid the cost increase of monthly billing and switch to an annual billing model, we’ll help you navigate these changes smoothly during your subscription renewal. We’ll also provide ongoing support and consultation so you can adapt to future licensing changes with as little disruption as possible.
