From March 2022 Microsoft will be implementing their new licensing model and will be increasing their prices as a result. You can review the key points below, followed by a series of FAQs and T&Cs. Please take your time to digest this information and don’t hesitate in calling the team if you have any questions. We’ve split the detail below into two sections (price increases and license changes).
From March 1st, Microsoft are raising the pricing of six of their most popular products in the market. This will affect you at different times, based on if you are currently utilising these services or not. This is Microsoft’s first price increase in over 5 years and, although not great timing, we believe that the increase in both product availability and service upgrades over this time warrant the change. As stated above, this is a change by Microsoft, and therefore is something out of our control. The main 6 products affected by the change, as well as the current estimated price increase is below.
• Microsoft 365 Business Basic – 20%
• Microsoft 365 Business Premium– 10%
• Office 365 E1 – 25%
• Office 365 E3 – 15%
• Office 365 E5 – 8.5%
• Microsoft 365 E3 – 12.5%
We will communicate how this translates with each of our customers in due course, and when it will affect you. If you’re already purchasing one of these products from us, then your pricing will stay the same until an anniversary date, which is based on when you first ordered the service. If you’re looking at purchasing one of the above products in the near future, please speak to our sales team / your account manager so we can work together to find the most suitable path for you.
Microsoft has recently announced a change in how customers purchase and manage their licences through their Cloud Solution Provider (CSP) Program, which is the platform you are currently buying your licenses through. On 10th January 2022, Microsoft is launching New Commerce Experience (NCE). This change will impact the way you purchase Microsoft 365 licences, with Microsoft’s intension to reduce complexity and provide cost savings for long term commitments, whilst introducing additional features over the course of the year.
Microsoft is offering a 5% discount for annual Microsoft 365 commitments. The annual discount will be available until the start of March 2022. Committing to your licences before the start of March 2022 will not only allow you to benefit from the discount, but also avoid the price increase for an extended period of time.
With the launch of NCE, Microsoft will be introducing additional ways of purchasing your office 365 services (alongside that of monthly rolling). These options will be 12 month and 36 month commitments (36 month coming later in the year), allowing you to save on any future cost increase by committing to the coming years. With these changes, however, comes some differences on how you can change your licenses quantities, which is explained below:
You will be able to make changes to your licenses in a 72 hour window once per month. This option is the most flexible on the New Commerce Platform, but will come at a price premium if you do not wish to commit for a long term. Seat additions can take place at any time, so you can add to your agreement like normal, however reductions can only happen in that 72 hour window monthly. Not all services are available on this model, so it’s worth checking with us before deciding on any agreement path.
You will be able to make changes to your licenses in a 72 hour window once a year. This option is less flexible than the above, but is not subject to the price premium and therefore is cheaper than it’s monthly counterpart. License additions are also the same as monthly. Payment for this option can either be on a monthly basis (with a year commit) or upfront.
Multi-Year Option (launching mid 2022)
You will be able to make changes to your licenses in a 72 hour window at the end of your 36 month term. This option is the least flexible, but is not subject to the price premium and therefore is cheaper than its monthly counterpart. License additions are also the same as monthly. Payment for this option can either be on a monthly, annually or upfront basis.
When will the new prices go into effect?
1 March 2022.
Which packages are affected?
Microsoft 365 Business Basic
Microsoft 365 Business Premium
Office 365 E1
Office 365 E3
Office 365 E5
Microsoft 365 E3
Will these new prices apply to education customers or consumers?
Why have Microsoft made this decision?
Microsoft say the new prices reflect the huge rise in remote working, which these products are helping to facilitate, plus they have added several new features over the last 12-18 months.
Will we be able to reduce the number of licenses we have?
No. You can cancel outright at the end of the month. But if you buy 10 licences, after 72 hours, you can only ever go as low as 10 during the month.
What if I want to downgrade my package?
If a customer purchases an E3 package, for example, they have to stick with that package for the entire term of the agreement, whether that’s a month or a year. That means every package has to be sold in the right way to customers and planned properly. We can help you with that.
How will this work for multi-year agreements for clients who regularly need to make a lot of changes?
Microsoft recommends in this case to go monthly. But monthly is more expensive. Multi-year will only work for customers who know their start point, and know they’ll never go under that point.
Can clients change partners mid-term?
No, you can not change partners mid-term.
How will the change affect long-term plans?
For multi-year and annual plans, you can still monthly bill, you can’t daily bill. And, if you want to make changes, you will only be able to do that
once a month in the specific window you have been given.
Can I still mix and match licences?
Yes. This hasn’t changed. You can still have some E3, some standard, some premium – in short, whatever combination that works for you.
How exactly will the pricing work?
Microsoft have said that any Office 365 order placed before March 2022 will be honoured at the purchase price, and that figure will be fixed for a year.
Will there be an update to the Terms and conditions?
There will be an update if you purchase via the NCE – as soon as this is published we will add it to this page.
If a member of staff leaves our business, meaning their E3 licence is no longer required, is that classed as a downgrade?
If you buy 20 E3s, and then no longer need all of them, you’ll still be charged for them all. Whatever is in place after those first 72 hours is
what they will bill, going forward.
Will Exchange Online be affected?
Currently, Microsoft have not confirmed this. We expect everything to go up as it would be strange if only Business Basic went up but apps such as
Exchange and Sharepoint stayed the same. But as yet, we don’t know.
Can I still invoice monthly?
Yes, you can. The only thing changing is that the new commit is either monthly, yearly or multi-yearly (see the ‘Licence changes’ section above).
Can I add new staff members on the old platform after March 2022?
No. The number of staff you have on the old platform as of March 2022 will be the maximum you can hold on the platform in the future. You
cannot flex those numbers up. Any new team members will have to be added to the new platform.
Will monthly still exist?
Yes, but in a different way. Rather than being able to flex up one day and take down on another, now you will only be able to make changes once
a month. You can bill monthly, you can cancel monthly, but this will be on a monthly rolling contract, rather than the old-style day rate.
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