BLOG | January 14, 2026
Microsoft continues to raise its prices - upward
Uwe Franke
Consultant
Licensing costs keep rising - how can you avoid them?
Microsoft has just announced that prices will rise again in the summer of 2026. The announcement was made in a blog post.
In a nutshell—new AI security and management features, but higher prices!
Key new features:
- Copilot Chat
will be further expanded and deeply integrated into Office apps, including calendar and inbox understanding as well as agent capabilities. - Enhanced security
Advanced email protection features are being integrated into Office 365 E3/Microsoft 365 E3; expanded URL protection is also coming to E1 and Business plans. - More IT tools
Additional Intune features for endpoint management (e.g., Remote Help, Advanced Analytics) are coming to E3/E5. - Security Copilot
will be embedded into the workflows of security teams and made available to all Microsoft 365 E5 customers.
Microsoft emphasizes its ongoing investment in innovation, productivity, and security – over 1,100 new features in the past year – and views these updates as the next step toward an AI-powered, secure future.
Copilot Chat
It is already available for free, but is set to be further developed, improved, and expanded, particularly within Office apps such as Outlook, Word, Excel, and PowerPoint.
Most users don’t take advantage of all the features these applications offer – it’s possible that additional unused features will now be added.
- Most only use basic features such as:
- Simple formulas (SUM, IF, CONCATENATE …)
- Sorting/filtering
- Simple formatting
- Basic charts
- Will it be more expensive in the future, but with AI support?
Enhanced Security
Microsoft Defender for Office 365 Plan 1 is being integrated into M365E3 – previously, it was only available in the M365E5 Suite or M365E5 Defender Suite, or as a standalone plan.
It is enabled by default for ALL users in the tenant (according to Microsoft’s product terms, all users must be licensed!!!) – administrators must then ensure that only licensed users can benefit from this service.
More IT Tools
Intune Remote Help: is enabled at the tenant level and cannot be restricted.
If the manufacturer has access to the tenant, it can view the enabled services, which could result in additional charges.
This isn’t the first time Microsoft has raised prices – here’s a brief timeline…
Going forward, Microsoft will review this every six months and evaluate it in light of exchange rate fluctuations against the USD. In euro-zone countries, this amounted to a +11% increase.
No prices have been reduced since then!
Teams Phone + 5%
Power BI Pro and Power BI Premium + 40%
For Level D end customers, contract renewals will result in a new base price that is 13% higher than in the existing contract.
Although the currency fluctuation would be about -10%, we’re satisfied with -7.4% in the eurozone – after all, we don’t want Microsoft to be struggling to survive and possibly start cutting back on investments in the cloud and AI. An adjustment would have been possible – or even necessary—as early as October 2025, but this delay will certainly satisfy the shareholders once again.
Case Study:
The customer has a Level D Enterprise Agreement (15,000 seats or more) with M365E3; some users utilize landline telephony and meeting rooms with Teams; some use Power BI Pro; and Dynamics 365 CRM is in use in the sales department.
Additional products such as Visio, Project, Exchange Online, or Copilot, as well as infrastructure products (e.g., Windows/SQL Server), are not included.
Increases in volume or upgrades to other products (e.g., from M365E3 to M365E5) are also not included.
A Level D customer certainly does not purchase at list price but receives a discount during contract negotiations; however, this discount has actually been decreasing in recent years, unless the customer purchases what Microsoft wants, in which case higher discounts are possible.
Teams Room Standard is no longer available – the customer must purchase Teams Room Pro (more features) – even if those features are not needed.
All features and services remain the same as in the previous contract.
The 3-year contract will cost 18.00% more – an additional € 3,394,864.80
Forecast for July 2026
Over the three contract periods (comparing Contract 1 to Contract 3), an increase of +6,559,833.60 € → a 42.60% increase.
In return, meeting room services (Teams Rooms) offer more features and enhanced security in M365E3. More IT tools and AI agents are included in the products and services.
…and we’re supposed to pay almost double for that?
Dear Microsoft, you have good products; they work, and people can get work done with them.
But perhaps you aren’t aware yet – there are companies that rely on other technologies or vendors for security and IT tools, for example, and there are also employees within those companies who don’t necessarily need or use AI features in the products.
Dear End Customers, how many more times can you go to the well before the jug breaks?
Prices are rising across the board – including software costs!
Without software, operations simply won’t function—carrier pigeons, clay tablets, and slide rules are a bit out of style.
What can you do to prevent software costs from rising even further?
Software costs can be effectively reduced on several levels – organizational, contractual, and technical.
1. Create transparency (the foundation for everything)
2. Avoid over-licensing
3. Establish Continuous License Management
4. Actively Negotiate Contracts and Terms
5. Improve lifecycle management
6. Evaluate Alternatives and Standardization
7. Outsourcing & Leveraging Expert Knowledge
In short:
Costs drop the most where transparency, clear processes, and active management come together. Often, just a few targeted measures are enough to achieve noticeable savings.
Support from external experts during contract negotiations can also save a great deal of money—these experts may have already negotiated or assisted with other contracts with Microsoft and can bring their experience to bear in your negotiations.
These experts can also point out what to look out for regarding Microsoft licensing, as well as the potential impact of product suites on your compliance and any potential additional charges from the vendor (e.g., tenant activation that cannot be restricted).
You’ll typically recoup the costs of such a project during contract negotiations—without having to completely overhaul your services or infrastructure.
Start now with a no-obligation initial consultation – and gain clarity on the actual optimization potential of your license portfolio..
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Uwe Franke
Consultant