Microsoft announced it would start ‘pricing alignment’ in April 2023, bringing local-currency pricing in line with US Dollar pricing.
This was done to give customers more consistent pricing across the globe: buying licences in other geographies had been cheaper, and many multinational companies were taking advantage of it.
The increase came after the March 2022 update that introduced Microsoft’s New Commerce Experience (NCE), a shift from monthly-rolling to annual commitments. Those who stayed on monthly commitments saw a 20% increase, while others committed to a set number of licences for the year. If you locked in the old pricing by committing to your NCE annual licensing before March 2022, you should expect the 9% increase come April 2023 unless you renew beforehand.
Read more in the Microsoft release here.
What can you do?
If you can commit to, or renew, your existing annual licences before April, you can lock in the current prices and hold this increase off until next year.
The cost of Microsoft licensing can’t be changed, but you can take steps to make sure you’re not overpaying:
- Double-check all licences are required, and that leavers’ licences have been re-issued to new starters rather than buying new ones.
- Ensure employees and emails have the correct licences assigned.
- Convert mailboxes you only receive into (not send from) to Shared Mailboxes, they don’t need licences.
- Commit to the right number of licences for the year, for someone staying only a month or two, monthly-rolling is cheaper than an annual commitment.
- Do all of the above before you commit to your new annual licences in April.
You can also take fuller advantage of the apps already in your Microsoft packages, potentially replacing other tools you pay for:
Apps you may already be paying twice for
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Tasks in Teams → instead of Trello
Manage to-do and task lists natively in Teams.
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Teams → instead of Slack
Chat and collaboration without a separate subscription.
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Shifts → instead of separate HR tools
Manage holidays and sickness via Shifts in SharePoint/Teams.
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Microsoft Bookings → instead of Calendly
Calendar booking built into your tenant.
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Intune → automate device builds
Save on install costs and time by automating device setup.
Speak to Sereno about managing your Microsoft licensing as part of our ongoing IT support service.
Get a free Microsoft 365 audit
Worried you’re overpaying for your Microsoft 365 licences, or not using Microsoft 365 to its full potential? Schedule a free audit and consultation with one of our knowledgeable advisors. To understand more about what working with Sereno looks like, and how we deliver a great service at a reduced price, reach out on 0203 089 01 41 or hello@serenoit.co.uk.
Frequently asked questions
Should I stay with Microsoft? Considering the breadth of applications in these packages and their constantly developing features, Microsoft still represents good value for money over its competitors.
Why is Microsoft making these changes? In certain countries, customers had been able to buy Microsoft licensing up to 40% cheaper in certain months due to local currency fluctuation.
What is the ongoing change? Microsoft will increase how often it reviews and realigns pricing to USD, giving customers the ability to plan for changes.
Does this mean my pricing will change all the time? Pricing updates are only made based on local currency fluctuation, reviewed twice a year to prevent large changes impacting customers.
If I commit to a year, can they still increase during the term? The details aren’t confirmed, but historically an annual licence term saw no increase until the renewal date.
Does Microsoft decrease prices? Yes. Microsoft recently decreased prices in New Zealand and Taiwan.
What about on-premises software licences? Pricing adjustments for on-premises software follow the same bi-annual review process.
How will I be notified about price changes? Sereno will share details with our partners as soon as we’re made aware.
Why doesn’t Microsoft just price in US dollars? Microsoft believes there’s a benefit to partners in purchasing products and licences in their local currency.
