New Microsoft 365 Pricing: What you need to know

After a decade of investing in improvements, Microsoft has announced that pricing changes will be made for enterprise and commercial subscriptions of Microsoft 365 packages. Although subscriptions are renewed and billed annually, the price increases are technically on a per user per month basis and will go into effect on March 1, 2022. Prices will increase for new and existing subscribers, but note that they will only increase for enterprise and business/commercial subscriptions, and education and consumer prices will not be affected.  

Microsoft was quick to react to the way working apart quickly changed the day-to-day realities of many—and the unique needs that frontline workers needed on a daily basis. New features were added and integrated across applications that improved collaboration and team dynamics to make working-together-while-apart feel manageable.  

What’s new?

Smaller price increases have been made over the years, but this announcement marks the first “substantive” pricing increase in the 10 years that Microsoft 365 (formerly known as Office 365) products have been on the market. The pricing changes will reflect the value of added features, functionalities, and elevated standards of quality—especially as so many new features and product upgrades have been made in the last year and a half alone. 

Gone are the days of unreliable internet access impeding meetings and video calls—Microsoft coupled the price increase announcement with news that Microsoft Teams will see new audio-conferencing capabilities for users across all suites- enterprise, business, frontline, and government subscribers. Soon, Teams will host unlimited dial-in capabilities so users can join meetings from virtually any device, regardless of location or internet connection. Dial-in capabilities also mean that users can join meetings without needing to download the Microsoft Teams mobile app, although we recommend it for quick collaboration on the go.  

Pricing changes

Each package price will really only increase by a few dollars per user per month, but the total dollar amount will appear as a higher lump sum when the charge rolls around as an annual subscription. In total, changes can amount to as little as $12 per user for Business Basics package subscribers to $48 per user for Microsoft 365 E3 package subscribers. It’s worth noting that Microsoft 365 E5 subscriptions, the priciest package at $57 user/month, will not be changing. You can expect notification of the pricing increase to be sent directly to your organization’s Microsoft admin portal. If you’re thinking about changing subscription packages, check out the different pricing models for enterprise and business subscriptions to compare and find the best fit for your business needs.  

So, what are the new prices? 

• Microsoft 365 Business Basic increasing from $5 to $6 user/month 
• Microsoft 365 Business Premium increasing from $20 to $22 user/month 
• Office 365 E1 increasing from $8 to $10 user/month 
• Office 365 E3 increasing from $20 to $23 user/month 
• Office 365 E5 increasing from $35 to $38 user/month 
• Microsoft 365 E3 increasing from $32 to $36 user/month 

The increase in pricing is on par with the added value that the entire fleet of products has seen. When Office 365 was first rolled out, the suite originally consisted of Word, Excel, PowerPoint, Outlook, Lync, Exchange, and InfoPath. And since introducing Microsoft 365 to the business-class app portfolio, 24 new applications have been added as well. Additions include savvy, appealing apps like Microsoft Teams, Power Apps, Power BI, and OneDrive. Not only were more apps added, but constant improvements were made to their integration abilities, so the entire suite of products works together seamlessly. 1,400+ new features have been introduced to the suite of Office products over the past decade, with particular emphasis on improved collaboration tools, automation, AI insights, embedded communication avenues, and security. The ability for real-time collaboration has become invaluable, and Microsoft has spared no detail in making sure users can connect, share, and keep in touch with anyone and everyone in their organization, even while working remotely or across differing time zones.  

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