Understanding the Latest 2025 Microsoft Licensing Changes

Starting in April 2025, Microsoft will implement licensing changes that offer businesses new methods to manage their subscriptions.

These updates emphasize the key differences between monthly and annual plans. This blog will provide you with insights into these changes and what they mean for your business.

Key Microsoft Licensing Pricing Changes

1. License Pricing Increases: Microsoft will implement a 5% price increase for several key products, including Microsoft 365, Office 365, and Dynamics 365. This increase will apply to both new purchases and renewals after April 1, 2025. Businesses with annual renewals before this date will not see the price hike until their next annual renewal in 2026.
2. Power BI and Teams Phone Adjustments: Significant price increases are also coming for Power BI and Teams Phone. Power BI Pro will see an increase from $10 to $14 per user per month, and Power BI Premium Per User will rise from $20 to $24 per user per month. Teams Phone Standard will increase from $8 to $10 per user per month.

2025 Microsoft Licsensing Promotional Opportunity

For new customers, Microsoft is offering the following promotional opportunity:

• Microsoft 365 E5 Promotion: From January 1 to June 30, 2025, new Microsoft 365 E5 customers can receive a 15% discount on annual subscriptions, with a limit of up to 2,400 licenses.

Monthly Billing Option for Microsoft 365 Copilot

Starting on December 1, 2024, customers who purchase annual term subscriptions of Microsoft 365 Copilot have the option to pay on a monthly basis instead of making an upfront annual payment. The monthly billing option for annual term subscriptions of Copilot is priced approximately 5% higher than the annual billing option.

Impact on Your Business

These pricing changes could significantly impact your IT budget, especially if you’re currently using monthly billing cycles. 

For medium-sized and large businesses with extensive user bases, the cumulative effect of these changes could result in substantial annual cost increases.

To prepare for the transition and manage these changes effectively, consider the following steps:

1. Conduct a Comprehensive License Review: Analyze your current Microsoft licensing to identify opportunities for optimization and cost savings. This review can help your business determine if it’s using the most cost-effective licensing options for its needs.
2. Develop a Timeline: Create a plan that takes advantage of current pricing while preparing for upcoming changes. For example, if your renewal date falls before April 1, 2025, you can lock in current pricing until your next renewal cycle in 2026.
3. Leverage Promotional Offers: Take advantage of Microsoft’s promotional opportunities to reduce costs. The Microsoft 365 E5 promotion can provide significant savings for new customers.

Looking for guidance on Microsoft Licensing? Contact Sourcepass Today!

Whether you want guidance on preparing and managing your IT budget more effectively or if you to take advantage of the Microsoft 365 E5 promotion as a new customer, Sourcepass is here to help.

Contact Sourcepass to speak with a Sourcepass Specialist to learn more!