Microsoft 365 is getting a rather uncharitable price hike

Microsoft has announced it will soon raise the price of its office software subscriptions for non-profit organizations.

The price hike will take effect on September 1 2022, and vary by degree depending on the specific subscription bundle. The most significant change will apply to the Office 365 E3 package, which will rise in price by almost 30% to $ 5.75/user/month.

Although Microsoft has only provided specific figures for US-based customers, the company has confirmed the rise will apply worldwide, with “local market adjustments” in some regions.

Microsoft 365 pricing

The move to raise prices for non-profit customers comes hot on the heels of a more broad-based price hike, announced last month. The change was described by Microsoft as the first “substantive Office 365 pricing update” since the launch of the productivity suite just over a decade ago.

In an FAQ post addressing the latest increase, Microsoft gestured towards the introduction of new Office 365 apps and services as justification for the change.

The company also said it believes both commercial and non-profit customers have recovered sufficiently from pandemic-related turmoil to shoulder the rise, even if conditions remain somewhat unpredictable.

“This is the right time to update our pricing. Although there are still questions and uncertainty, we see clear signs of economic recovery around the world,” wrote Microsoft.

“Moreover, over the past few years our competitors have increased prices, in some cases aggressively. We simply have a better story and proven track record of reinvestment in the product and consistently delivering new value to our customers.”

Despite the price hike, the rates for charities and other non-profits remains considerably lower than for typical commercial customers, with discounts as large as 75% across some packages.

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Microsoft Office 365 cost hike delayed for some users

Microsoft has decided to delay its planned price increase of Office 365 for an additional two weeks for some of its reseller partners.

Back in August of last year, the software giant announced in a blog post that its first “substantive” price increase since launching Office 365 in 2011 was set to occur on March 1 of 2022. 

For those unfamiliar with Microsoft's pricing changes, Microsoft 365 Business Basic will increase from $ 5 to $ 6 per user per year, Microsoft 365 Business Premium will go from $ 20 to $ 22, Office 365 E1 will go from $ 8 to $ 10, Office 365 E3 will go from $ 20 to $ 23, Office 365 E5 will go from $ 35 to $ 38 and Microsoft 365 E3 will go from $ 32 to $ 36.

Thankfully though, pricing will not increase for consumers or Microsoft's education customers at this time but businesses that use Microsoft's office software can expect to pay quite a bit more depending on how many employees they have when they need to renew their subscriptions.

Pricing grace period

In a support document published at the end of February, Microsoft informed its reseller partners that it had created a “transitional grace period” due to high demand by businesses looking to renew their subscriptions before the company's pricing changes went into effect.

As a result, Cloud Solution Providers (CSPs) now have until 5pm PDT on March 14 or 12am UTC on March 15 to submit transactions and have them invoiced at the software giant's February 2022 pricing. This means that the next few weeks will likely be quite busy for CSPs as businesses try to renew one last time with the old Office 365 pricing.

While Microsoft did wait over a decade to raise the price of both Office 365 and Microsoft 365, some businesses could turn to Google Workspace or other Microsoft Office alternatives following the implementation of the company's planned price increase.

Via ZDNet

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Your Microsoft Office subscription price might be about to see a major hike

Microsoft is preparing changes to how it charges its cloud-based productivity suite Microsoft 365 (formerly known as Office 365) that could leave many customers facing higher software bills. 

CNBC reports that the “New Commerce Experience for Office” offering, set to be introduced in January 2022 will result in prices for the productivity suite spiking 20% for customers who pay on a monthly basis. 

Furthermore, Microsoft seems to be eliminating the option to scale the subscription back. If customers decide, halfway through the subscription, to stop using the service, they will still need to pay for the remainder of the term.

Unhappy customers

CNBC claimed the news has been distributed through third parties and via several Microsoft employees who did not want to be named. 

Microsoft’s official statement is that the company “provides flexible purchasing options to meet our customers’ diverse needs, and we don’t publicly disclose information around our premium and pricing approach for partners.”

Discussing the matter with the publication, one Microsoft partner said its customers had already raised concerns about the changes. Intivix co-founder Rob Schenk said he’s been notifying clients about the 20% increase for month-to-month arrangements, and the responses have been “mixed”, with some clients saying they “don’t like it at all”.

Some people have also taken to Reddit and to, to voice their dissatisfaction with the changes and to try and urge Microsoft into abandoning the idea.

Initially, the company planned on implementing the New Commerce Experience in October this year, but pushed it to January. From March 2022, all new orders will have to go through New Commerce Experience, with renewals having until July.

For the first half of the year, Microsoft will charge the same price for both monthly and yearly offers – with those who opt for an annual subscription apparently spared the price hike.

Having multiple payment options, as well as the ability to scale up and down easily, proved to be essential for the survival of many businesses during the pandemic. 

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