Navigating Microsoft’s CSP Licensing Price Increases
- HBS Microsoft Licensing Team
- Read Time: 3 mins
Microsoft is rolling out a 5% price increase for CSP customers with annual subscriptions and monthly billing starting April 1, 2025. This update impacts all Microsoft products, including Microsoft 365, Office 365, and Dynamics 365.
If you’re on a monthly billing cycle, use this time to reassess. Microsoft licenses and subscriptions can be notoriously confusing, time-consuming, and frustrating—now is the best time to go over what you currently have, what you currently use, and what you’ll need going forward.
Microsoft Subscription Price Changes
Starting in April, Microsoft will adjust pricing across annual subscriptions that are billed monthly. If you pay annually, you will not see a change. If you have an annual subscription and pay monthly, you will see an increase in your bill. Monthly term subscriptions are not impacted as they already contain their own surcharge.
Existing subscriptions will be impacted upon their renewal date after April 1, 2025. New subscriptions purchased after April 1, 2025—with an annual term bill monthly—will be impacted immediately.
It is important to note that this will affect all industries—commercial, nonprofit, education, and government.
Microsoft has stated that the aim of these changes is to standardize billing structure across all of their purchasing models.
HBS Recommendations
- Switch to Annual Billing
While there is no guarantee Microsoft won’t increase prices at a later time, moving to annual billing will save you from this hike. Moving to annual billing will decrease your TCO (total cost of ownership). - Upgrade or Add Seats Before April 1
If you’re considering upgrading your subscription, or adding additional licenses, do it prior to April 1 to lock in current pricing until renewal date.
This goes double if you are considering adding Power BI and/or Teams Phone seats. Those products will see an additional price increase on April 1 for commercial customers. - Take Advantage of Microsoft’s E3 and E5 Promotions
Microsoft is offering several limited-time discounts that could potentially help offset the impact of these changes for commercial customers.
Microsoft 365 E3 and E5 Promotions
- 15% off first purchase of Microsoft 365 E3 and E5 licenses.
- Offer valid from January 1 - June 30, 2025.
If you’re close to the 300-user cap for Business Premium subscriptions, or if you’re looking to add additional security features, these promotions could be a wise decision.
Additionally, if you want to explore Microsoft 365 E5 licenses, but are disappointed in the removal of Teams, the Microsoft 365 E5 promotion could keep your cost at the previous price —when Teams was included—for one year.
Ultimately, as with any licensing and billing changes, you need to be proactive—evaluate your options, take advantage of any applicable promotions, and plan ahead.
Resources to Help You Plan
We’ve covered similar pricing updates, like the Power BI and Teams Phone price increase and the Copilot monthly billing options. These articles offer insights and strategies to navigate changes effectively.
HBS Microsoft licensing experts are ready to help you evaluate your current subscriptions and explore ways to optimize costs and products. We exist to help you navigate a complex licensing landscape—we would love to help you get the most for what you pay.
Secure your subscription strategy today. Reach out to an HBS licensing expert and discover how we can help you save on Microsoft licensing costs while keeping your IT spend predictable.
