Microsoft has unveiled several significant updates to its Microsoft 365 and other commercial products. A monthly payment option for Copilot addons and an increase in prices for monthly billing of many other plans.
The usual Microsoft phrases are being thrown around. Lot’s of talk about “standardization” plus “consistency and transparency”.
Why the changes?
Behind all that are two reasons behind the changes:
- Commercial customers are reluctant to pay $360+ upfront, per user for Copilot. Monthly payments let them spread the cost, albeit for a 5% surcharge.
- Microsoft wants organizations to pay annually for their core Microsoft 365 and other licenses. So, they are adding 5% more to monthly payments to encourage a switch to annual charges.
Monthly Billing for Copilot with Microsoft 365
Starting December 1, 2024, Microsoft will offer a monthly billing option for annual term subscriptions of Microsoft 365 Copilot, Microsoft 365 Copilot for Sales, and Microsoft 365 Copilot for Service.
This new option lets customers pay on a monthly basis rather than making an upfront annual payment. However, there are catches:
- It’s still an annual commitment (unlike the monthly Copilot Pro) and early cancellation still involves penalties.
- The monthly billing option will be priced 5% higher than the annual billing option and will be available across Buy Online, CSP, and MCA-E platforms.
Note: this only applies to the commercial Copilot addon for Microsoft 365 volume licences. The consumer Copilot Pro addon remains a monthly commitment and billing.
“Standardizing” Monthly Billing Prices
From April 1, 2025, Microsoft will raise the monthly billing price for all new and renewing annual term subscriptions.
Sorry – it’s not a price rise. Microsoft says it’s a “standardization” to “introduce” a “price update”.
A 5% price update applies to the monthly billing plans for annual subscriptions across Buy Online, CSP, and MCA-E. Plans affected include:
• Microsoft 365
• Office 365
• Enterprise Mobility + Security
• Windows 365
• Microsoft Dynamics 365 Services
• Microsoft Power Platform
• Other Online Services
To keep the current prices, customers have to switch over to annual billing with upfront payment at their renewal date.
Teams Phone Pricing Update
Microsoft Teams Phone, gets its first “price update” since 2017 for annual term subscriptions starting April 1, 2025.
For new and renewing commercial customers, the price of Teams Phone Standard will be $10 per user, per month ($120 per user/year). Pricing for Teams Phone for Frontline Workers and Teams Phone with Teams Calling Plan bundles will also be updated.
For more detailed information with plenty of Microsoft corporate speak go here.
