Microsoft 365 Price Increases

If you are an organization that subscribes to certain business flavors of Microsoft 365 and Office 365, get ready to dig deeper into your pocket for the premium plans. Microsoft has announced price increases for six different products beginning March 1, 2022. The prices will only affect specific business and commercial editions, with education and consumer subscription being spared. While announcing the higher prices, Jared Spataro, the Microsoft 365 corporate VP, summed up the changes as “the first substantive pricing update since we rolled out Office 365 ten years ago.”

Microsoft 365 New Price List

Microsoft will update its price list for the following commercial products:

Microsoft 365 Business Basic increases from $1 to $6 per month per user.
Microsoft 365 Business Premium increases from $2 to $22 per month per user.
Office 365 E1 increases from $2 to $10 per month per user.
Office 365 E3 increases from $3 to $23 per month per user.
Office 365 E5 increases from $3 to $38 per month per user.
Microsoft 365 E3 increases from $4 to $36 per month per user.

From the above list, it is evident most, but not all enterprises and business plans will see a price hike on March 1, 2022. The dollar amount ranges from $1 to $4 per user per month. This translates to $12 to $48 per user per year, meaning the percentage increase runs as low as 9% to as high as 25%, depending on the type of plan.

Which Plans Are Not Affected?

As mentioned earlier, some plans retain the standard pricing. These include Microsoft’s most expensive and comprehensive subscription plan, the Microsoft 365 E5, going for $57 per user per month. Additionally, the consumer- and education-specific plans will not see any price increase, at least for now.

While announcing the prices changes, Spataro said, “There are no changes to pricing for education and consumer products at this time.” The phrase “at this time” has got the attention of most analysts, with many believing it is only a matter of time before Microsoft increases the prices for these plans too.

What Are the Enhancements to Microsoft 365?

Microsoft touted several improvements and enhancements on their productivity products over the years to justify the higher prices. Since launching Microsoft 365 years ago, Microsoft has added 24 apps to the suite, including Microsoft Teams, Power Apps, Yammer and Whiteboard, Power Automate, Stream, Planner, Visio, OneDrive, and more.

The company has also released over 1,400 new features and capabilities in three key areas:

Communication and collaboration

Microsoft launched Teams in 2017 as an integrated solution where people can meet, chat, call, collaborate, and automate business processes. Teams now has over 250 million monthly active users who use the platform for work, life, and learning. Some of the new enhancements made to Teams since its launch four years ago include:

In 2020 alone, Microsoft added over 300 new capabilities to Teams, including Together mode, background effects, live captions with speaker attribution, breakout rooms, live reactions, large gallery view, raise hand, fluid components, and more.

Hybrid work applications: Alive to the demands of the current workplace, Microsoft also introduced a set of collaborative applications in Teams designed to empower people and organizations for hybrid work. The specific applications include SharePoint, Power Platform, Planner, Shifts, Forms, Whiteboard, Lists, and more.

Integration with apps from third parties: additionally, Teams has been designed to integrate with other apps from companies such as Atlassian, Adobe, SAP, ServiceNow, Salesforce, and Workday. These apps help bring business functions directly into the flow of work, thus enhancing productivity.

Real-time and asynchronous collaboration: Microsoft also introduced real-time collaboration in Excel, Word, and PowerPoint desktop apps. It has also added capabilities to streamline the collaboration experience, including auto-save, modern comments, assign tasks, and @mentions.

Security and compliance

There is no doubt the current cybersecurity landscape is facing myriads of challenges thanks to an acceleration in volume and sophistication of cyberattacks targeting businesses and organizations. Recent studies reveal Cyberattack on organizations worldwide jumped 29% during the first half of 2021 compared to the same period in the previous year. Since introducing Microsoft 365 four years ago, Microsoft has added top-notch attack surface reduction capabilities to help businesses and organizations protect their assets from ransomware and other threats. The specific capabilities include:

Data loss prevention (DLP) for email and documents
Sensitivity labels and message encryption that prevent data leakages
Top-notch compliance capabilities to help organizations reduce risks and stay compliant with regulatory requirements such as Content Search, eDiscovery, and core Litigation Hold
Built-in mobile device management (MDM) and other management tools that help organizations support remote and hybrid workforces while minimizing risks of attacks.

AI and automation

In the last ten years or so, Microsoft has injected AI capabilities across their productivity and collaboration applications to help users achieve enhanced efficiency and productivity. Some of the notable AI-powered innovations in Microsoft 365 include:

AI-powered innovations that help workforces improve their writing, design, and presentation skills
Cloud-powered AI that can create maps, charts, and tables in Excel automatically. This feature can also sort out emails and get rid of clutter in Outlook.
AI-powered real-time captions, transcription and translation, captions, designed to enhance collaboration and communication while making it more engaging and accessible to everyone.

Are There Planned Enhancements to Microsoft 365 in the Future?

On August 18, 2021, Microsoft announced they are adding unlimited dial-in capabilities for Microsoft Teams meetings that will cut across the enterprise, business, frontline, and government suites. These new capabilities, spread over the next few months, are designed to ease connectivity issues from a bad internet connection. The dial-in is currently included in Microsoft 365 E5 and Office 365 E5 and is available with subscriptions in over 70 countries and 44 languages and dialects.

Is the Price Increase Justified?

There is no doubt Microsoft has delivered more value to its products over the past decade. The additions and enhancements targeting Microsoft 365 continue to provide users with everything they need to succeed and thrive in the current highly volatile marketplace. Considering that the prices of these products have remained unchanged for the past 11 years, we believe it is long overdue. If you have any questions regarding the price changes and how it affects you, don’t hesitate to contact Menark Technologies. We provide IT Support, Managed IT Services & Technology Solutions for organizations from a solo entrepreneur to over 250 employees in Philadelphia, PA, Wilmington, DE, and the entire MidAtlantic. Contact us today to learn more.