Microsoft’s first ‘substantive’ price increase for many Office 365 SKUs is still happening in March, but a couple of weeks later than announced for some of its resellers.
Mary Jo Foley has covered the tech industry for 30 years for a variety of publications, including ZDNet, eWeek, and Baseline. She is the author of Microsoft 2.
Six months ago, in August 2021, Microsoft unveiled a coming “substantive” price increase for Office 365, due to take effect on March 1. But on February 28, Microsoft announced a delay in that increase for some of its reseller partners, creating a two-week grace period.
On March 1, 2022, Microsoft was slated to increase prices globally for most of its commercial Office 365 and Microsoft 365 subscriptions. The increases will range from $12 per user per year more for Microsoft 365 Business Basic to $48 per user per year more for Microsoft 365 E3. Pricing for consumers, education and the highest-end Microsoft 365 E5 SKU will not increase at this time, officials said last year. Officials said the increases were the first noteworthy ones since Microsoft launched Office 365 more than a decade ago and would keep Microsoft in line with what its competitors (read, Google) were charging.
But on February 28, Microsoft told its reseller partners that some of them would get a two-week reprieve on the planned pricing changes. Cloud Solution Providers (CSPs) and other partners working through them now have until 12 a.m. UTC on March 15 (or 5 p.m. PDT on March 14) to get their transactions posted at the current, pre-increase amounts. Microsoft officials cited “current high demand” leading up to the March 1 pricing changes as the reason for the delay.
I can’t help but wonder if partner pushback over various changes Microsoft is making to its Cloud Solution Provider program under the “New Commerce Experience” banner also played into the decision to give partners more time to help their customers stave off the coming price increases.
Some Microsoft customers will be paying substantially more for Office 365 once their contracts for their subscriptions come up for renewal.
The planned price increases, as previously announced by Microsoft:
Microsoft is not changing the pricing of Microsoft 365 E5, which goes for $57 per user per month, at this time.
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