Microsoft 365 and Office 365: new pricing for business and Enterprise customers

Martin Brinkmann
Aug 21, 2021
Microsoft Office

Microsoft announced plans to change the pricing of the company's subscription-based services Microsoft 365 and Office 365 this week.

The pricing changes will go into effect on March 1, 2022 for business and Enterprise customers. Home and education product pricing won't change "at this time" according to Jared Spataro, Corporate Vice President for Microsoft 365.

The pricing of the following products will change on March 1, 2022 (all plans per user)

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

Pricing will be increased globally "with local market adjustments for certain regions", according to Sparato.

Microsoft notes that the pricing increase is the first since the introduction of Office 365, released in October 2010. Microsoft 365 launched on July 10, 2017 and most Office 365 products were rebranded at the time to take into account new non-Office products such as Microsoft Teams, Power Apps, OneDrive, Yammer or Whiteboard, that were added to select subscription plans.

The pricing increase "reflects the increased value" added to the subscription plans since the launch of Office 365 and Microsoft 365.

Sparato's post on Microsoft's Microsoft 365 website highlights some of the new features and additions before the new pricing is revealed.

Highlights mentioned include the following:

  • Integration off Microsoft Teams as "the only integrated solution" to "meet, chat, call, collaborate, and automate business processes".
  • New category of collaborative apps in Teams.
  • Real-time and asynchronous collaboration in Microsoft Word, Excel and PowerPoint desktop apps.
  • New attack surface reduction to better defend against ransomware and other threats.
  • Data Loss Prevention for emails and documents.
  • Built-in mobile device management.
  • AI-powered features and tools across Microsoft 365.
  • Audio conferencing capabilities improvements.

Pricing increases by up to 20%, depending on the subscription plan.

Closing Words

Will business and Enterprise customers accept the price increase, or go looking for other products? It seems likely that the majority will keep most if not all subscriptions in place.

Home users won't see announcements about price increases in the near future according to the announcement, but the "at this time" phrase suggests that a pricing increase will be announced for the Home products eventually as well.

Now You: are you subscribed to any of the mentioned products?

Microsoft 365 and Office 365: new pricing for business and Enterprise customers
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Microsoft 365 and Office 365: new pricing for business and Enterprise customers
Microsoft announced plans to change the pricing of the company's subscription-based services Microsoft 365 and Office 365 this week.
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  1. just say NO to m$ mafia said on August 24, 2021 at 10:24 am


    >I don’t “subscribe” to things. I buy them if I need them and the price is right.

    That’s why, IMO, M$ still exists! They fool people into thinking they NEED them when they really don’t.

  2. Anonymous said on August 22, 2021 at 6:35 pm

    I have yet to find a single use case where “the cloud” helps the user do anything better than the solutions we were deploying before. Perhaps there is a benefit for huge companies with heavy resources, but for the single user, household, or small business the only things to come out of the cloud, cloud based apps, and/or subscription service software is sub-par performance and way more expense.

    I would agree that Microsoft’s monopoly has to be busted.

    Next up – try to find desktop accounting software. Everything has moved to the web, which is exactly where someone wants their most important data (I’m using EXTREME sarcasm here), and the only two remaining desktop accounting packages in the small business space (Quickbooks and Sage 50, formerly Peachtree) are not all that great to start with, but have been made blindingly expensive to make the subscription service pricing seem less offensive in comparison.

  3. Peterc said on August 22, 2021 at 6:21 pm

    A couple of days back, Martin posted an article about LibreOffice 7.2, which had just been released. A commenter asked why anyone would still be interested in LibreOffice, given the availability of online alternatives like Google Docs (or whatever the service is currently called) and Microsoft Office 365. This price hike is one of the reasons. Microsoft is becoming a rentier.

    1. ULBoom said on August 23, 2021 at 1:12 am

      Our kids put up with Google Docs etc on school issued Chromebooks for years. All of that stuff is dreadful. They’ll never buy a chromebook ever, for certain, positively, No! A pathetically large number of assignments were turned in one year by taking photos with their phones, then emailing them to their teachers.

      And all the ads, everywhere, ads.

      Purely a guess but I’d bet that commenter was used to laggy apps and had little concern about privacy.

  4. Tony said on August 22, 2021 at 6:18 am

    The only “increased value” I get from O365 is better troubleshooting skills gained from dealing with their bugs.

  5. Bruce Mangee said on August 22, 2021 at 6:15 am

    If you based your workflow around such a service it get’s harder and harder to switch.
    Look at Apple- or Android-Store users.

    It’s ‘The Trick’ Microsoft pretty much invented in the homecomputer days.
    Provide a software nearly for free (or don’t pursue the illegal distribution), wait for it to spread and then if the saturation of you software sets in start to charge money and pursuit illegal copies.

    Office368 came with convenience and a low price tag and now it’s time to boil the frog, slowly.

    It’s even better than in the old days of standalone apps that can run forever, now your Office365 stops working after a month without internet. You can circumvent that too, but not very many know how, so pay up. ;)

  6. Gerold Manders said on August 22, 2021 at 2:21 am

    And so it begins….

    Gradually upping the fee, but just below to what the market will sway back to use on-premise hard-/software.

    Cloud is easy and nice for a few tasks, but not to the level of idolizing as it gets right now.

  7. Anonymous said on August 22, 2021 at 2:00 am

    Renting software is nonsense. I rarely use Office anymore, only at work. At home I use LibreOffice.

  8. JF said on August 21, 2021 at 9:30 pm

    Typical M$. Office is a monopoly and unless this changes consumers and especially business etc will be blackmailed forever by them and they will keep increasing prices. In any market they have the numbers even today they have this kind of behavior. If they get the numbers in browser market again for example with Edge they will start having the same behavior they had in IE days with “this site works best in IE”, silverlight, activeX etc.

    1. Mark said on August 22, 2021 at 7:28 am

      Goverments should force Microsoft to open source docx format, it’s the only way to have real competition in office market. Nobody can make a competing office suite without being able to open/write docx files without compatibility issues.
      But it won’t happen, they are busy with Open Apps Market Act against Apple and Google and as always Microsoft is getting away with everything and now they are making it even harder to change default browser in Windows 11.

      1. Peterc said on August 22, 2021 at 6:15 pm

        @Mark: I’ve noticed that tech journalists, legislators, and regulators (both US and EU) who once used “GAFAM” (Google, Amazon, Facebook, Apple, Microsoft) as shorthand for Big-Tech conglomerates worthy of antitrust scrutiny are increasingly substituting the term “GAFA,” without the M. It’s as though Microsoft had managed to cut deals with the press and various governments to escape antitrust enforcement in exchange for … ? Microsoft still holds a quasi-monopoly in a number of markets, including office-productivity software, and don’t believe for a second that the little slaps on the wrist they’ve gotten from the US DOJ and the EU DGC have fundamentally changed its long-term behavior. As a rapper might say, monopolies gonna monopolize. The world of computing would be a whole lot healthier if Microsoft had been broken up into a separate OS company, a separate applications company, and a separate hardware company (which I believe was the remedy originally contemplated by the first trial judge in US v. Microsoft).

  9. Clairvaux said on August 21, 2021 at 4:49 pm

    I don’t “subscribe” to things. I buy them if I need them and the price is right. When did businesses reinvent them into states, and started convincing people they should pay a company tax every month ?

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