Microsoft cloud services are more expensive again – how to decrease your costs?
On April 1st this year, Microsoft increased the prices of its cloud services, including Azure and Microsoft 365 subscriptions. The change aims to equalize their pricing globally, reflecting the exchange rate between customers’ local currencies and the US dollar. This is the second major price increase since March 1st 2022, when only new Microsoft 365 subscriptions were affected. The present change applies to all cloud services and subscriptions offered by Microsoft.
What does the price rise mean to customers? Current purchase agreements and subscriptions with fixed prices for a specific period of time will not be affected. However, once they are renewed or when new services and subscriptions are ordered after April 1st 2023, the newly announced pricing rules will be applied. For customers in the EU, it means their future purchases will be up to 11% more expensive than previously.
Product | Old price (1 year) | New price (1 year) | Price difference |
|---|---|---|---|
Office 365 E3 | €271.20 | €301.20 | ↑ €30.00 |
Office 365 E1 | €100.80 | €112.80 | ↑ €12.00 |
Microsoft 365 Business Premium | €223.20 | €247.20 | ↑ €24.00 |
Microsoft 365 Business Standard | €126.00 | €140.40 | ↑ €14.40 |
Microsoft 365 Business Basic | €61.20 | €67.20 | ↑ €6.00 |
How can you minimize the impact of Microsoft’s constantly increasing cloud pricing?
1. Optimize your work costs with hybrid solutions
Cloud services often include a vast array of tools and functions which are not used in full by all users, but have to be paid for nonetheless. They are a fixed part of the package, and are commonly presented as a justification for a higher cost of the subscription. Although they may be necessary for a handful of so-called ‘power users’, such as high-level employees, decision-makers, and project managers, many companies don’t maximize the value of the product, and their operational expenditures gradually become higher with no tangible positive effect on the performance of their employees.
In this case, the optimal course of action is to deploy a hybrid solution for non-power users – a combination of perpetual Microsoft software licenses and low-tier Microsoft 365 subscription plans. Hybrid solutions assure constant access to the most important up-to-date productivity tools and cloud services, such as OneDrive and MS Teams, and at the same time provide desktop applications like Word and Excel through a stable version of MS Office. Costly subscriptions can be downsized only to users who really need them, and the rest of the employees can work with the same tools as before, but at a significantly lower expense for the organization.
Price comparison between a Microsoft 365 subscription and a hybrid solution for 250 employees over a 5-year period
The hybrid solution becomes more cost-efficient in the second year, and at the same time provides desktop Office apps and better features for all employees thanks to the robust Office LTSC 2021 suite.
Interested in a hybrid solution tailored to the needs of your organization? Contact us for a consultation with our experts!
2. Bring your own perpetual licenses to Azure dedicated hosted services
Instead of getting the Microsoft 365 subscription, customers who use Azure cloud computing can bring their own perpetual licenses (BYOL – Bring Your Own Licenses) – under the following conditions set by Microsoft:
deployment of Microsoft perpetual Volume licenses (without Software Assurance) is allowed only for single-tenant Azure environments;
the perpetual licenses must have been released and purchased prior to October 1st 2019.
The possibility of applying the BYOL model to an organization’s IT infrastructure needs to be assessed individually for each case – contact our consultants to find out if you can make use of it!