Microsoft Prices going up?! | Changes 2025

Microsoft’s latest announcements bring a host of licensing and pricing changes that can impact your planning for 2025 and beyond. In this blog post, we’ll run through the most critical updates—from annual plan price increases to new Team’s Phone rates and CoPilot’s new monthly billing options—so you can make informed decisions and communicate effectively with your customers.

1. Annual Paid Monthly Price Increase +5%#

What’s Changing?#

If you’re on an annual commit, paid monthly Microsoft NCE (New Commerce Experience) plan Microsoft is introducing a 5% price increase upon renewal.

Ref: Flexible billing for Microsoft 365 Copilot, Pricing updates for annual subscriptions & Teams Phone | Microsoft Community Hub (opens in new tab)

Key Dates & Details#

• Effective Date: Starting April 1, if you renew your annual NCE plan with monthly payments, you’ll see a 5% price bump.
• Prepaid Annual Option: If you switch to fully prepaid annual, you avoid this 5% increase altogether.
• Renewal Timing: If your renewal date falls before April 1, you won’t see the price hike until your next renewal cycle. For instance, a March 2025 renewal means no price jump until March 2026.

Possible Strategies#

1. Prepaid Annual: Lock in current pricing if you can afford the upfront payment.
2. Multi-Year Commit: A 3-year commit may protect you from potential future increases.

2. Currency Adjustments (UK & Brazil)#

British Pound (GBP)#

Microsoft is making FX-related adjustments that could reduce pricing by around 5–6% for customers in the UK region. However, if you’re also on the annual NCE plan paid monthly, this reduction might simply cancel out the 5% increase mentioned above.

Ref: December 2024 announcements – Partner Center announcements | Microsoft Learn (opens in new tab)

Brazil (BRL)#

Brazil is seeing a 12% price increase due to currency adjustments, which could significantly affect cost planning for organizations in that region.

3. Team’s Phone Price Changes#

If you rely on Microsoft Teams Phone for your VoIP/calling needs, note that certain standalone plans are going up in price:

• Phone Standard: Increasing from $8 to $10 per user per month.
• Teams Phone with Calling Plan: Increasing from $15 to $17 per user per month.

Who’s Affected?

• These increases primarily impact organizations on standalone Teams Phone subscriptions.
• If you’re on higher-tier suites like Office 365 E5 or Microsoft 365 E5, which already include phone capabilities, there’s no new price change.
• Current Teams Pricing: Microsoft Teams Phone—Cloud Phone System | Microsoft Teams (opens in new tab)

4. Microsoft CoPilot: New Monthly Billing & Free Plan#

New Monthly Billing#

Microsoft CoPilot initially launched with only an annual prepaid option, which deterred some from adopting this AI-powered offering. Now, you can opt for annual plans paid monthly—giving you more flexibility if you only want to test the waters.

• Pricing: Month-to-month on an annual commitment is 5% higher than the annual prepaid rate.
• Availability: This option went live in December.

Free CoPilot Chat#

Microsoft is introducing a free version of CoPilot chat in Microsoft 365 subscriptions, but with a pay-as-you-go consumption model for certain queries (e.g., SharePoint-based questions).

Ref: Copilot for all: Introducing Microsoft 365 Copilot Chat | Microsoft 365 Blog (opens in new tab)

Key Differentiators Between Free & Paid Tiers#

• Paid CoPilot: Includes SharePoint Advanced Management (previously a $3 add-on). This helps govern and secure data—critical when enabling AI features that might expose too much information to end users.
• Free CoPilot Chat: Useful for basic AI-driven tasks but may incur consumption charges for each query.

5. Promotions & Discounts#

1. CoPilot License Promotion (15% Off)
   • Scope: Requires a 10-seat minimum.
   • Terms: Available only on annual commitments (either paid monthly or prepaid).
2. Business Premium Discount
   • 15% Discount on Business Premium for net new subscribers.
   • If you act before April, you effectively avoid the upcoming 5% price uptick—making it a 20% net discount in total.
   • Key Use Case: Upgrading from Business Standard to Business Premium to unlock advanced security features.
3. Office 365 E3/E5 Promotions
   • Mainly for organizations that have outgrown Business Premium’s 300-seat limit or need advanced security.
   • Runs until June; however, SMBs typically see lower adoption rates for E3/E5 unless they have specific enterprise requirements.

1_10_25_Global Promo Readiness Guide_v1 (opens in new tab)