Brace for July 1st: What the M365 Price Increase Means for MSPs (and How to Get Ahead of It)

Posted: June 26th

Author: Nicole Finn

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Any M365 suites renewing on or after July 1st, 2026 will see a significant price increase — between +5% and +33% depending on the SKU. If you have customers with renewals coming up,
now is the time to plan, not after the new pricing lands.

Back in December, Microsoft confirmed it would be raising commercial list prices on Microsoft 365 suite subscriptions, with the changes taking effect July 1st, 2026.

The headline reason

Microsoft is folding a wave of new AI, security, and management capabilities into the suites, and the list prices are moving up to reflect that added value. Microsoft has said it’s sharing the news early to give customers — and partners like us — time to plan. Here’s what’s changing, what your customers are getting for the money, and how to make the renewal window work in your favour.

So what exactly is happening in July?

Effective July 1st, 2026, Microsoft is adjusting its global commercial list prices (in USD) to account for the added AI, security, and management features being built into the suites. The changes apply globally, with local market adjustments for each region, and nonprofit pricing will move in line with commercial rates.

Commercial subscriptions will see increases ranging from +5% up to +33%, depending on the SKU. We don’t have the final local pricing yet — and at this point, we wont get it until July 1st, but the percentage changes have been announced.

Here’s what we know:

SKU % Increase
Microsoft 365 E3 +8%
Microsoft 365 E5 +5%
Office 365 E3 +13%
Microsoft 365 F1 (Teams) +33%
Microsoft 365 F3 (Teams) +25%
Business Basic (Teams) +16%
Business Standard (Teams) +12%
Business Premium No change announced

These list prices are for the SKUs that include Microsoft Teams. You can also buy suites without Teams, which carry an equivalent dollar-value increase. Azure consumption pricing is not part of this. Azure adjusts monthly based on FX rates and sits outside this specific price event. This affects cloud services only — there are no changes to on-premises licensing here.

What are customers actually getting for it?

This isn’t a flat price rise — Microsoft is loading meaningful capability into the suites alongside it. It’s worth being able to articulate this to customers, because “the price went up” is a much harder conversation than “here’s everything you’ve gained.” The key additions:

AI for everyone via Copilot Chat. Microsoft 365 Copilot Chat brings secure AI chat for work to all M365 users, now with inbox and calendar awareness and access to Word, Excel, and PowerPoint agents — so users can work iteratively with Copilot to build documents, spreadsheets, and presentations. IT admins get enterprise-grade controls to secure, manage, and measure it.
Stronger email and Teams threat protection. The enhanced email security of Microsoft Defender for Office 365 Plan 1 is being added to Office 365 E3 and Microsoft 365 E3. URL checks are also coming to Office 365 E1, Business Basic, and Business Standard to protect against malicious links in email and Office apps.
Integrated endpoint management. Microsoft 365 E3 and E5 are gaining capabilities including Intune Remote Help, Intune Advanced Analytics, and Intune Plan 2. E5 customers also pick up Endpoint Privilege Management, Enterprise Application Management, and Microsoft Cloud PKI.
Security Copilot for E5. Microsoft Security Copilot — with 70+ Microsoft and partner-built agents built into the flow of work across Defender, Entra, Intune, and Purview — is rolling out to all Microsoft 365 E5 customers, with 30 days’ notice before activation.

For context on the scale of investment behind this: Microsoft says it shipped more than 1,100 features across Microsoft 365, Security, Copilot, and SharePoint in the past year.

How MSPs can get ahead of it

The single most important point for your customers: anything renewing before July 1st locks in at today’s pricing. Anything after that date moves to the new, higher list price. That gives you a genuine window to add value.

A few ways to play it:

Audit your renewal pipeline now. Identify every customer with a renewal due in the second half of the year, and flag the ones close to the July 1st line.

Have the proactive conversation. Customers will hear about this one way or another. Being the partner who brought it to them first — with a plan — is worth a great deal.
Look at term and timing options. Depending on a customer’s renewal date and commitment term, there may be ways to structure things in their favour before the change lands.
Frame it around value, not just cost. Every affected suite is gaining AI and security capability. The renewal is a chance to talk roadmap, not just line items.

Don’t forget Copilot renewals.

There’s also a new bundle SKU landing on July 1st that pairs Copilot directly with the business plans — and for a lot of customers it’s the smarter way to buy. The RRP for Copilot bundled with Business Standard is expected to come in around €22, and Copilot with Business Premium around €24. If you’ve got any Copilot licences due to renew this week, or anything falling on or after July 1st, it’s well worth looking at moving those customers onto one of these bundled SKUs rather than renewing Copilot as a standalone add-on. As always, the final local pricing isn’t confirmed yet, so have a word with your MWH account manager before you commit — we’ll help you work out which option lands best for each customer.

We sometimes have hints and ways around these things, so it’s genuinely worth a conversation. Speak with your MWH account manager to review your upcoming renewals and work out how best to maximise your margin keep your customers costs down ahead of July 1st.