Microsoft Purchase Program Changes

Carrie Alicata

Microsoft announced new pricing and changes that will introduce new terms and billing options for specific Microsoft Cloud Subscriptions, such as Microsoft 365, through your Cloud Solution Provider (CSP) like Connection. So, here’s what is changing and what you can expect:

A New Billing Model

Microsoft is introducing a new billing model for Cloud Services called New Commerce Experience (NCE). Under NCE, you’ll have these three options to pay for your Microsoft 365 licenses:

  1. Month-to-Month Commit: Month-to-month payment
  2. Annual Commit: Annual or monthly payment options 
  3. Multi-Year Commit: Annual or monthly payment options *Availability date TBA

If you’ve just purchased or are renewing as of July 11, 2022, you’ll be enrolled in the NCE billing model with these term options. If you’re currently purchasing monthly term products, there will be promotions available through June 2022 to help you move and save money. 

A New Pricing Model

On August 19, 2021, Microsoft announced global list price increases to their Microsoft 365 user licensing. These price increases are effective on March 1, 2022:

  • Microsoft 365 Business Basic, from $5 to $6
  • Microsoft 365 Business Premium, from $20 to $22
  • Office 365 E1, from $8 to $10
  • Office 365 E3, from $20 to $23
  • Microsoft 365 E3, from $32 to $36
  • Office 365 E5, from $35 to $38

There are no current changes to pricing for education or consumer.

How to Reduce Financial Impact to Your Business

Through the end of June 2022, Connection—as your CSP partner—is offering promotional pricing when you renew, transition, or start your licensing journey. As a tip, if you’re currently a monthly subscriber, moving into an annual commitment will lock in your pricing before March 1, 2022. 

Annual commitments will also give you the option to save money on your licensing. If you’re currently purchasing licensing month-to-month, making a 1- or 3-year commitment on select products will afford you the best price. You’ll have the option to schedule renewal changes with your CSP partner ahead of time, and plan out your licensing journey for the year ahead. 

How to Maintain Flexibility for Growth

The month-to-month flexibility to change licensing and user counts is a requirement if your business is experiencing rapid growth or uncertainty. This option is still available, but as a premium service. To maintain the flexibility needed for your business, you can anticipate a 20% higher cost over annual or multi-year pricing. We encourage you to work with us, as your CSP partner, to take advantage of any promotions to offset increases through June 2022. 

Key Dates to Help You Plan

December 31, 2021—The last day to transact in Microsoft Open Business

January 10, 2022—NCE is generally available

March 1, 2022—Microsoft 365 price increases are effective

March 10, 2022—All new cloud services licensing will be transacted through the NCE

June 30, 2022—Promotional offers end in the NCE

July 11, 2022—All renewals of cloud services licensing business to be renewed in the NCE

Bookmark this blog and subscribe to our Microsoft Tech Insights to receive continual updates, FAQs, and announcements about the NCE for Microsoft cloud subscriptions through Connection.

Carrie shares her expertise in Microsoft licensing for state and local government, and education. In her free time, Carrie enjoys concerts, football, and traveling.

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