Microsoft 365 Pricing in 2025: What You Should Know Before You Buy
If you’re managing Microsoft licensing this year, the landscape has shifted — and understanding your purchasing options & channel is more important than ever.
As of April 1, 2025, Microsoft applied a 5% price increase to the legacy monthly-billed subscription prices below for annual commitments. This affects:
• Microsoft 365
• Office 365
• Dynamics 365
• Windows 365
• Power Platform
This move is part of Microsoft’s global strategy to align cloud pricing, migrate mid-market and small business to third-party cloud service providers (CSPs) and encourage annual billing.
Web-Based Cloud Solution Providers (CSPs) vs. Microsoft Direct:
When buying Microsoft licenses, your choice of channel can impact both cost and support:
CSPs are large businesses that essentially cut aggregate volume deals with Microsoft. They are ideal for organizations seeking better pricing flexibility, tailored support, and value-added services. While buying direct from Microsoft offers standardized pricing and infrastructure.
• At the end of your MS contract term, expect a 5% increase if you’re on monthly billing – direct with Microsoft.
• Web-based CSPs may offer better pricing and support than buying direct.
• Choosing Business Premium as security and device control is important. It’s only a difference of ~$10 difference per-user, per-month. And it’s well worth it for Microsoft’s Intune and Microsoft’s Advanced Threat Protection (ATP).
Need help evaluating your licensing options? Looking to increase security or reduce your annual expenditure on Microsoft licensing?
Contact your Transition Paradigm Account Manager today you better understand your options.
