Microsoft 365 pricing changes: 3 important details you should know
Updated March 14, 2022

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Updated March 14, 2022:  As the original post below forecasted, Microsoft has brought in new pricing for Microsoft 365 with effect from March 1, 2022. We have checked the information below against the latest information from Microsoft and, as of writing, the detail below is still correct. Whether you’re an existing M365 customer and have a renewal in the coming months, or are considering moving to Microsoft 365, and want to better understand the implications of the new pricing, speak to an SHI Microsoft licensing expert today for some free advice.

On August 19, Microsoft announced pricing increases to their Microsoft 365 and O365 commercial plans – the first significant pricing update in a decade.

The price hike will be effective as of March 1, 2022 and will apply only to commercial products. Educational and consumer plans are not impacted by this announcement, and changes to government plans will be phased in over several years.

SHI’s experts have reviewed Microsoft’s announcement closely, and have summarized the three key details regarding these changes, and what you need to know moving forward:

  1. Increase in commercial plan pricing

Effective March 1, 2022, pricing for commercial plans will increase as follows:

Plan Current Price New Price % Change
O365 E1 $8 $10 25%
O365 E3 $20 $23 15%
O365 E5 $35 $38 9%
M365 E3 $32 $36 13%
M365 E5 $57 $57 0%
M365 Business Basic $5 $6 20%
M365 Business Premium $20 $22 10%

Note: Pricing reflects ERP

  1. Pricing changes will apply to Commercial Volume Licensing Agreements, CSP, and Web Direct Customers

Volume Licensing Agreement and Cloud Solution Provider (CSP) customers will be price protected for the applicable subscription plans for the term of their agreement/subscription, provided they were purchased prior to March 1st, 2022. If any applicable plan purchases are initially made after March 1, 2022, pricing will be based on the increased cost.

Existing customers will not be impacted until their renewal date on or after March 1, 2022.

  1. Extension of unlimited audio conferences dial-in across all suites

This capability is currently included in M365 E5 and O365 E5 plans.  Microsoft is extending this capability to a broader range of suites across enterprise, SMB, frontline, and government. Impacted plans include the following:

  • Enterprise Plans: M365 E3, O365 E3, O365 E1
  • Frontline Worker Plans: M365 F3, M365 F1, O365 F3
  • SMB Plans: M365 Business Basic, Business Standard, and Business Premium
  • Government Plans (GCC, GCCH, DOD): M365 E3, O365 E3, O365 E1, M365 F3, M365 F1

As with all Microsoft pricing and licensing related changes, it is critical that our customers have a thorough understanding of the impact to their current and future agreement structure.

Realizing this price increase will have a significant impact on your organization’s budget planning and priorities going into next year, SHI is ready to work with you to get a full understanding of your Microsoft estate and opportunities to optimize. Our 365 Cost Optimization Services have been helping customers identify redundant, duplicate, and underused licenses while providing guidance on how to get the most out of their Microsoft 365 investment.

Work with SHI to get that conversation started now, so that when these new pricing changes come into effect, you can be confident that you’re only paying for what you’re using. Contact us today or reach out directly to your account representative to get started on optimizing your Microsoft 365 estate.