Microsoft announce twice-yearly pricing updates

Microsoft has recently announced that they are bringing in twice-yearly updates to their pricing, to align the pricing of Microsoft Cloud products globally. 

What is the reason for this pricing update?

Currencies globally have been impacted differently by the macroeconomic environment, which also affected their exchange rate compared to the US dollar. For a sustained period, Microsoft had deferred pricing adjustments based on such currency fluctuations, but as of 1st April 2023, Microsoft is realigning Cloud pricing globally. 

Which products are affected by the upcoming price updates?

All Microsoft Cloud products are affected, with the exception of Azure products taken under a Microsoft Customer Agreement, as these prices are already in dollars. 

When will the first of these price updates take place?

From 1st April 2023, GBP pricing on all Microsoft Cloud services will increase by 9%. 

Other currency updates include: 

• Danish Krone: +11%  
• Euro: +11%  
• Norwegian Krone: +11%  
• Swedish Krona: +15% 

How often will the pricing change?

Once the initial adjustment is made on the 1st April 2023, Microsoft will continue the process on a 6-monthly cycle going forward (1st April and 1st October) to ensure that local pricing does not drift too far from USD again.  

Future price adjustments are currently unknown, but rates may increase or decrease. 

How will the price update affect existing customers?

For customers on a monthly commitment, the pricing updates will take effect on the first monthly renewal after 1st April 2023. For those on an annual commitment, the pricing updates will only take effect at your next renewal date after 1st April 2023. 

For customers that have not yet transitioned to Microsoft’s New Commerce Experience, the pricing updates will take effect at your next annual licence anniversary after 1st April 2023. 

How can our organisation reduce the impact of the upcoming price increase?

If your organisation is considering taking on new product licenses, it is possible to switch to annual or three-year subscriptions before 1st April 2023. These subscriptions have the additional benefit of a further 20% discount when compared to monthly subscriptions, and will ensure that prices are locked in at the lower rates for a full 12 or 36-month period. 

Get in touch

As usual, if Microsoft provides any additional updates around this, we will update this blog accordingly.  

If you have any questions about your existing licenses or the twice-yearly pricing update discussed in this article, please don’t hesitate to get in touch. You can do so by filling out the contact form, emailing us at info@pragmatiq.co.uk, or calling us on 01908 038110.