We will gladly talk you through your options to see whether your business would benefit from staying on a yearly subscription or opting for Microsoft’s rolling monthly package.
Earlier in the year, Microsoft announced a change to the way its customers can purchase and manage their Office 365 licenses.
Pricing was previously managed via Microsoft’s Cloud Solution Provider (CSP) programme. This has been phased out and replaced with the New Commerce Experience (NCE), which aims to make purchasing Microsoft’s software much easier and simpler for businesses that rely on this technology.
Here’s a breakdown of Microsoft’s new monthly and 12-month subscription options, and how they compare.
| Monthly Subscription | 12 Month Subscription | |
|---|---|---|
| Payment Options | Monthly | Monthly and Annually |
| Cancellation/ Adjustment Window |
72 hours | 72 hours |
| Seat Changes | Increase always. Decrease within cancellation/ adjustment window | Increase always. Decrease within cancellation/ adjustment window |
| Pricing | 20% increase over 12 month subscription | Standard |
| Benefits | Flexibility | Cost savings and price locking |
Will my Microsoft subscriptions be more expensive in 2023 under the new programme?
If you choose the monthly option, yes. Monthly fees for 365 are set to increase by 20% on 1st January 2023.
However, the NCE’s monthly plan is much more flexible.
For starters, you can purchase your Microsoft licenses without having to commit to an annual fee. Your rolling monthly subscription might be 20% more expensive than the yearly one, but you will be able to make more regular adjustments to your plans, based on changing seat counts (ie, staff joining or leaving your company).
What’s more, you can choose whether you are billed on a monthly or annual basis – something that could certainly help with cash flow.
Bear in mind that if your seat requirements change throughout this 12-month period, you can increase the number of licenses you hold, but not decrease them.
Unless you choose to opt out within Microsoft’s 72 hour (3 day) cooling off period, you also won’t be able to cancel this year-long agreement until the end of its term (or any additional licenses you have purchased during this time).
Why do you need to review your Microsoft licenses now?
You will need to double check your licensing requirements now if:
- You made no changes to your licenses before the NCE was rolled out in March 2022, and were temporarily placed on the equivalent CSP legacy package; or
- You took advantage of Microsoft’s discounted packages before March 2022 and are unsure which subscription option will best suit your needs from the end of February 2023 onwards.
You must make sure you don’t end up overpaying for your Microsoft services, and that all price increases are accounted for.
For help navigating Microsoft’s new pricing structures, please contact the team at ECOM UK today.
We will gladly talk you through your options to see whether your business would benefit from staying on a yearly subscription or opting for Microsoft’s rolling monthly package.
We will gladly talk you through your options to see whether your business would benefit from staying on a yearly subscription or opting for Microsoft’s rolling monthly package.
