Microsoft Price Increase: Here's How You Can Save

by TechNet UC

In March, Microsoft announced a price increase for all Microsoft 365 subscriptions effective April 1, 2025. But did you know there are ways to get ahead of the price increase and save money? You could even lock in the rate you’re currently paying.  Let’s break it down and explain your options.

Why This Matters

In the new cost structure, Microsoft’s month-to-month (P1M:M) billing model increases by 20%. With software budgets under increasing pressure, this can add up—especially for organizations with multiple licenses.

The solution is to move to an annual plan before your current renewal date. You have two options under the annual plan.

One is the annual plan, paid monthly (P1Y:M). If you choose this route, your cost will only increase 5%. That’s a 15% savings over the month-to-month plan.   

The second option, and the most cost-effective, is to sign up for annual prepaid (P1Y:Y). Customers who choose annual prepaid prior to their renewal date will see no increase for the next 12 months. You lock in the same rate you’re paying now.  

Here's a chart illustrating the cost benefits of an annual plan versus month-to-month.

By taking advantage of the P1Y:Y model, you can:

• Lock in your current pricing and avoid these newly announced increases.
• Save up to 20% in additional charges versus monthly payments.
• Simplify budgeting and improve long-term cost forecasting.

Take Action Before Your Renewal

To benefit from the savings, you must make the switch before your current subscription renews. Microsoft does not allow mid-term changes from P1Y:M to P1Y:Y, so timing is critical. Once your renewal date passes, your organization will be locked into a new, higher pricing structure for the next 12 months.

We recommend reviewing your subscription details and renewal schedule as soon as possible. Making this change only takes a few minutes and can lead to significant annual savings—especially for businesses managing multiple licenses across departments.

Final Thoughts

With Microsoft’s price increases set to affect your bottom line, now is the time to take a proactive approach. Switching to annual upfront billing isn’t just a cost-saving decision—it’s a strategic one.

In an environment where every dollar counts, making this small administrative change can deliver measurable impact across your IT and finance operations. Don’t wait—act before your renewal date to secure your savings and protect your budget for the year ahead.

TechNet UC is a premier Microsoft Solutions Partner and our experts are here to assist. Book now to save!