Microsoft's New Pricing for 365: Feb 2023 UPDATE | Microbyte

Microsoft’s New Pricing for 365: Feb 2023 UPDATE

Microsoft Money

In 2023, Microsoft Azure is streamlining its global cloud and on-premises pricing strategies for a more consistent and transparent experience for customers. The new approach aims to align pricing across markets while also providing better visibility and predictability.

Here’s how this policy will be implemented and the advantages it brings to your business.

Aligning Global Cloud Pricing for Greater Consistency

In response to recent global developments such as the COVID-19 pandemic and the conflict in Ukraine, Microsoft temporarily suspended local currency pricing adjustments, leading to pricing disparities across regions.

In an effort to promote consistency and transparency in its cloud pricing, Microsoft will be implementing a new pricing strategy effective April 1, 2023. The new approach will tie cloud product prices to the local currency exchange rate with the US dollar, offering customers increased predictability and clarity in cost estimates.

This move aligns Microsoft with industry standards, making it easier for customers to compare and make informed decisions about their cloud solutions.

Microsoft is committed to supporting its customers and partners during these challenging times. The company stated, “We understand the uncertainty in the current global landscape and are dedicated to providing the support and resources our customers and partners need to succeed.”

As of April 1, 2023, Microsoft will increase the pricing of its cloud products in the following currencies:

  • GBP: +9%
  • DKK, EUR and NOK: +11%
  • SEK: +15%

Microsoft’s global cloud pricing realignment will be implemented in phases, starting with selected regions, with the goal of completing the process smoothly and efficiently. Communication is key, and Microsoft promises to keep its customers and partners informed and up-to-date throughout the process, ensuring a smooth transition to any pricing changes.

Implication for Customers

The forthcoming pricing adjustment by Microsoft is expected to bring both benefits and challenges to customers. On the positive side, the new approach to pricing will promote global consistency, transparency, and predictability, allowing customers to make more informed decisions when selecting cloud solutions.

Furthermore, Microsoft will conduct biannual evaluations, providing customers with the opportunity to plan and budget accordingly.

However, it’s important to note that exchange rate adjustments may result in increased (or decreased) costs for some customers.

Please note that this change is limited to cloud pricing and will not impact on-premises products.

Microsoft Azure

Microsoft Azure is a cloud computing platform and infrastructure created by Microsoft for building, deploying, and managing applications and services. Azure offers a variety of pricing options, allowing customers to choose the right solution for their needs and budget.

The pricing for Azure services is mostly based on a pay-as-you-go model, where customers only pay for the resources they consume. This gives customers the flexibility to scale up or down as needed without incurring any upfront costs or long-term commitments.

Unlike competitors, Microsoft offers 16 local currencies to pay for Azure services. This allows customers to use their preferred currency and avoid exchange rate fees, reducing costs and providing greater control over expenses.

Final Thoughts

Please be advised that Microsoft’s new pricing strategy will result in an increase for Euro and Pound Sterling customers. To secure your current pricing, we recommend signing up for a 12-month agreement before April 1st. 

If you’re interested in transitioning to an annual pricing plan, our team is available to provide further information and assist you with the process.

Should you want a more in-depth understanding of how Microsoft have developed this new structure, please download your copy below.

Commercial-pricing-update-FAQ-5.pdf