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Upcoming Office 365 Price Changes

Microsoft 365 NCE

Microsoft recently announced that from the 1st March 2022 it is making a substantial price increase to its licensing programs for the first time in over a decade. There will be between an 8.5% and 20% increase across all licencing programs. The following licenses are affected:

  • Microsoft 365 Business Basic
  • Microsoft 365 Business Standard
  • Microsoft 365 Business Premium
  • Office 365 E1
  • Office 365 E3
  • Office 365 E5
  • Microsoft 365 E3

Will this price increase affect me?

If you are using Microsoft 365 or Office 365 then yes, unfortunately. Where SIGMA are providing your licensing, we have no option than to migrate your licenses to the new pricing model from 1st March 2022 onwards, but you do have some options.

Alongside the price increase comes the New Commerce Experience (NCE) - customers will be able to commit annually and fix the prices for 12 months at the same price as they are currently. Alternatively, a month-by-month commitment is still possible but on top of any price increase, this also attracts an additional 20% premium! For example, Microsoft 365 Business Basic on a monthly commitment will be 40% more expensive.

Microsoft365 New Experience

What are my options?

Microsoft have advised us that transitioning to NCE is the time to assess each customers needs, for example:

  • Customers with a stable or expanding workforce will be attracted to annual term offers due to price predictability.
  • Customers with variability in workforce due to seasonality or business uncertainty will likely prefer monthly term offers that allow cancellation or seat reduction in any month.

We will be contacting all customers within the next week to inform them of the changes, and provide information on how you can tell us which option you would prefer. Due to the reduction in flexibility and additional complexity the NCE presents to our operations, we are also restructuring our pricing for Microsoft/Office 365 support, but there will still be an ad-hoc support option with no commitment.

Answers to Common Questions

  1. Annual subscriptions can be paid monthly. As SIGMA would still be liable for paying the subscription if our customer's business went into liquidation, we are only allowing the monthly payment of annual subscriptions to businesses that have been trading for two years or more.
  2. You can only upgrade or add licenses to an annual commitment, not downgrade or remove licenses. For monthly commitments, downgrades or removal of licenses can be done at the end of each month.
  3. You can have annual and monthly licenses at the same time.
  4. You can receive a prorated refund of the initial subscription payment only within the first 72 hours after the order is placed or renewed. After 72 hours of the term, the subscription cannot be cancelled and payment for the remainder of the term must be made. This includes annual subscriptions.
  5. Existing (legacy) licenses will be automatically terminated on 1st July 2022 if they have not been moved to NCE.

If you are unsure how this all affects you, please get in touch to discuss your options with us.

20 January 2022