Microsoft announces price increase for Office 365 and Microsoft 365

Microsoft is announcing its first price increase for its Office 365 and Microsoft 365 services in a decade. The price increases will affect commercial and business users of Microsoft’s software as a service (SaaS) offerings next year, with no changes to pricing for education or consumers.

Microsoft’s updated pricing will go into effect on March 1st, 2022:

Microsoft 365 Business Basic (from $5 to $6 per user)
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)
Microsoft first launched Office 365 in 2011 across 40 different markets, and the company has been improving it ever since. These price changes mark “the first substantive pricing update since we launched Office 365 a decade ago,” explains Microsoft 365 chief Jared Spataro in a blog post today.

They also come as Microsoft has reported a record year of revenue growth thanks to cloud services like Office 365. Microsoft has more than 300 million paid seats for Office 365, so the price changes will certainly bump Microsoft’s profits and revenue even further next year.

While larger businesses will have benefited from bulk discounts and deals over the past decade, it’s the small businesses that will feel the effects of an increase in pricing as the economy starts to recover from a pandemic. Either way, Microsoft has added more than 20 apps to Office 365 since it originally launched, including Microsoft Teams, OneDrive, SharePoint, and To-Do.