Effective April 1, 2023, Microsoft are implementing a Pricing Harmonisation Programme on Cloud Services – which will be the start of a semi-annual pricing review. The harmonisation is aimed at bringing local currency pricing in line with dollar pricing. Twice a year, the exchange rates against the dollar will be reviewed, and an in line adjustment will be made to local pricing.
Cloud Services “per seat” licensing will be affected, as will legacy Azure consumption.
Azure consumption via the New Commerce Experience Azure Plan and also perpetual (and on-premise) licences are unaffected by this change.
What is the new Pricing Harmonisation Programme for the Microsoft Cloud?
Starting April 1, 2023, products will be subject to a 9% increase in pricing in GBP. This increase will take effect immediately for those subscriptions on a monthly commitment plan, as these restart on the 1st of each month. Where the subscription is on an annual commitment (which could be paid either as an annual fee or a monthly fee), the pricing change will take effect on the renewal of the term.
Microsoft have advised that the harmonisation will take place on a semi-annual cadence. As yet, the second date hasn’t been announced, but I expect this may be September 1, 2023.
In the UK, as mentioned, there is a pricing increase this year – but this may not always be the case. In other territories where this programme has already been implemented, there have been reductions on some occasions. The adjustments will all be based on the exchange rate to the dollar – so local pricing may increase, decrease or stay the same.
Pricing changes will only take effect twice a year, except in the case of Azure Plan on New Commerce Experience (NCE) consumption – which is charged in dollars and converted on a monthly basis to the local exchange rate by Microsoft. This has been in effect since the move to Azure Plan on NCE, and is not part of the change.
Receive more blogs like this straight to your inbox
Sign up to receive our latest blogs and stay up to date with our latest news, Microsoft 365 updates, events, webinars and workshops.
Who will be affected by the consistent global pricing?
We appreciate the subject of licensing and pricing is a complex area, so to help simplify this – I have listed examples of licences which our clients may have below and which would be impacted by this change. These are all purchased via our Cloud Solutions Provider programme.
Microsoft 365 E* / F*
Office 365 A* / E*
Microsoft 365 Business Basic/Standard/Premium
Enterprise Mobility & Security E*
Teams Phone Standard
Teams Phone with Calling Plan (all variants)
Other Office Applications
Visio Plan *
Power BI Pro/Premium*
* This is a range of licensing SKUs, e.g. Microsoft 365 E1, E3, E5, F1, F3 etc.
What do I need to do?
At this point in time, no action is required. If you use the flexibility of the monthly commitment, you may want to consider if there are further licences you can roll into your annual commitment. There are benefits to rolling licenses into your annual commitment of up to 20%. If you are considering purchasing additional licenses in the new financial year, there are savings to be made by ensuring that the orders are placed in advance of the changes.
If you need any further advice about the forthcoming changes, our Intelogy Microsoft Licensing Specialists backed by our partners at Pax8, and Technical Specialists are available to discuss your needs.
Having worked in technical services for many years in several industries, I am now dedicated to supporting customers once they have solutions in place. Being passionate about Microsoft 365 and Service Management, and with 7 years of experience in this field, I look for innovative ways to support customers. Making it easier to get the most out of the platform and services you have invested in matters to me. Overseeing our Managed Services and Support Team, I see a wide variety of requests – and we are always looking to go the extra mile through our friendly approach.