Many small and medium-sized businesses treat Microsoft Office and Microsoft 365 subscriptions as fixed operating costs. Once licences are set up, they are rarely reviewed unless a problem arises. However, upcoming pricing changes mean this approach could lead to higher IT costs than expected.
Microsoft has announced that commercial Office and Microsoft 365 subscription prices will increase from July 2026, affecting business and government users. While individual adjustments may seem minor, they can add up over time, particularly for organisations with growing teams or front-line staff.
Why Prices Are Changing
Microsoft continues to invest heavily in its productivity, collaboration, and security platforms. As a result of these investments, and to support ongoing service improvements, pricing changes are becoming necessary.
Because price changes for commercial Office subscriptions have been relatively infrequent, many businesses may not be prepared for the July 2026 increase.
What Businesses Should Expect
From July 2026, a number of commonly used commercial plans will carry higher subscription fees. This affects both SME-focused plans and subscriptions designed for enterprise or front-line users.
For businesses with a large number of operational staff, even small per-user increases can create noticeable changes in overall IT expenditure.
What This Means for Businesses
1. Higher software costs over time
Without regular licence reviews, businesses may see rising monthly charges without a clear explanation. Rising software costs across vendors can quickly accumulate and impact budgets.
2. License optimisation becomes essential
Many businesses assign the same Microsoft 365 plan to all staff. As prices rise, this approach becomes less sustainable.
Common issues include:
- Users not fully utilising assigned features
- Front-line staff on higher-tier plans
- Inactive accounts still being billed
3. Planning ahead helps control costs
Knowing that prices will increase from July 2026 allows businesses to plan budgets earlier, review licence usage, and avoid reactive decisions later.
Conclusion
The upcoming Microsoft 365 price increase highlights the importance of proactive IT and licence management. Businesses that regularly review subscriptions and plan ahead are better positioned to control costs and maintain predictable IT spending.
Source: CNBC
Article: “Microsoft will raise prices of commercial Office bundles in July”
Link: https://www.cnbc.com/amp/2025/12/04/microsoft-will-raise-prices-of-commercial-office-bundles-in-july-.html