Microsoft 365 has already gone up: the percentage that scares you is not the one that costs you money

All through June the same piece of advice went around: renew before 1 July and you freeze your price for another year. It was good advice. It expired four weeks ago. The Microsoft 365 commercial suite price increase took effect on 1 July 2026 and it is now starting to show up in renewals. What almost nobody has spelled out is that the percentage in the headlines and the money you will actually pay are not on the same plan: the 33% increase is on a product that cost 2.25 dollars and now costs 3, and the 5% one goes from 57 to 60.

We are not resellers of any platform: we recommend based on the case, not on the commission. So this post is not going to end in "move up to E5". It is going to end in the math, which is what you should bring to the renewal meeting.

The table, which is short

Microsoft publishes two parallel sets of prices: the suites with Teams and the suites without Teams, which are the ones Microsoft sells to new customers in the European Economic Area and Switzerland since 1 October 2023, when it unbundled Teams from the package. We start with the first set, the one nearly every headline quotes, and then move to the column that probably applies to you. List prices in dollars per user per month:

SUITES WITH TEAMS

This is where it pays to stop, because if you signed up in the European Economic Area from October 2023 onwards, this is not your table (anyone already subscribed before that could carry on with their original suite, so it is worth checking which SKU your contract actually names). The without-Teams suites have their own prices and their own percentages, and they are higher: F1 without Teams goes from 1.75 to 2.50 dollars, a 43% rise; F3 without Teams, from 6.93 to 8.93 (29%); Business Basic without Teams, from 4.40 to 5.40 (23%); Business Standard without Teams, from 9.29 to 10.79 (16%); Office 365 E3 without Teams, from 14.45 to 17.45 (14%). And the two still cells stay still: Business Premium without Teams remains at 18.79 and Office 365 E1 without Teams at 6.79. If you have seen a 43% figure going around and assumed somebody was exaggerating: they were not. It is on the same Microsoft page, in the table next door.

And the usual caveat: these are US list prices. In Spain you are billed in euros and every channel —cloud provider, enterprise agreement, direct purchase— applies its own rates and discounts, so these tables show direction and magnitude, not your invoice to the cent. The exact figure is in your contract, not in a blog post.

The percentage scares; what costs money is the multiplication

A 33% is a headline. Translated: F1 goes up 75 cents a month, nine dollars a year per person. A 5% is a headline for nobody. Translated: E5 goes up three dollars a month, thirty-six a year per person. The smallest of the percentage increases costs four times more per user than the biggest one. It is primary-school arithmetic, and it is still the part that gets lost the moment someone puts the percentage column on a screen in a meeting.

The only math that matters is this: monthly increase × people × 12. With list prices, on a typical headcount:

Which leads to the least intuitive conclusion in the whole announcement: the company that will feel this most is not the one on the plan that rose the most, but the one with the most people on a plan that rose a little. If your mix is mostly E3 or E5, your percentage is one of the good ones in the table and your invoice is one of the ones growing most in absolute money.

The price that does not change says more than the ones that do

In a table where almost everything goes up, two cells sit still: Office 365 E1 and Microsoft 365 Business Premium, which stays at 22 dollars. The second one is the interesting one. Business Standard goes from 12.50 to 14. Which means the gap between Standard and Premium drops from 9.50 to 8.00 dollars: the step narrowed by 16% without Premium touching its price. And this is not an artefact of reading the wrong table: the without-Teams one gives exactly the same result — 18.79 minus 9.29 was 9.50, and 18.79 minus 10.79 is 8.00. Both sets of prices tell the same story. Neither coincidence nor generosity: it is a staircase with the top step moved closer.

Our take, which is not the brochure's: if you were already buying device management or mail protection separately to patch the gaps in Standard, the math has changed and deserves redoing — with one honest correction, because part of that gap closed on its own: Standard now comes with time-of-click URL protection. What it still does not come with is Intune, Defender for Business and Entra ID identity and access policies, and that is exactly what Business Premium does include in its price. If you are not going to enrol a single device in Intune and nobody is going to write conditional access policies, Business Premium is exactly what you have today, eight dollars more expensive. A licence on its own configures nothing. And one detail everyone forgets as soon as a company grows: Business plans are capped at 300 users; past that, it is a different conversation.

You are getting more. The question is whether you will switch it on

The increase comes bundled with new capabilities inside the suites. In short, including the two that are not going up in price:

This is not vapour: Defender for Office 365 Plan 1 or Intune Plan 2 bought separately cost real money, and here they are inside the price. But it is worth saying plainly, because this is where the money from this increase actually gets lost: a licence is not a control. Defender for Office 365 filters nothing until somebody creates and tunes the policies. Intune manages no laptop until somebody enrols it and decides what happens when it falls out of compliance. Cloud PKI does not issue certificates on its own. And you have to be precise about the calendar, because it does not all land at once either: Microsoft only commits to having a specific set of components rolled out by 1 August 2026 —Defender for Office 365 Plan 1, Intune Remote Help, Intune Advanced Analytics, Intune Plan 2, Intune Privilege Management, Microsoft Cloud PKI and Intune Application Management—; the rest of the repackaging arrives tenant by tenant with prior notice in the Message Center. What arrives, whenever it does, is the possibility of using it, billed since July.

So when we review a tenant, the first question is not whether licences are missing: it is what has been bought and never configured. The increase does not create that problem, it makes it visible. Which is why the best use of these weeks is not negotiating the percentage but actually configuring what you are already paying for. In the same bucket: reviewing your second factor. We wrote about SMS being retired as an MFA method and the passkey calendar, which is the same tenant and the same quarter.

What the increase does not include, and will not

None of the added capabilities is a backup. Retention is not backup, the recycle bin is not backup and archiving is not backup: they are built for mistakes and deadlines, not for somebody who signs in with valid credentials and deletes. We covered that with a real case —including the uncomfortable part about what happens once the attacker holds the keys— in the wiping of Romania's land registry. If your Microsoft 365 recovery plan is Microsoft 365's own retention, the gap is still there, new invoice and all. Same with availability: paying more does not buy a plan for the day the service stops answering, which is a separate exercise and one we broke down after this July's outage.

What we would do before your renewal

Five things, in this order, and none of them needs a phone call to start:

In short

The increase is already in force and there is no window left to run for: it reaches your contract on the day you renew. The percentage is the least of it, because the scariest one sits on the cheapest plan and the mildest one is the one multiplied by the most people. The expensive part of this autumn will not be paying 8% more. It will be renewing exactly last year's licence inventory, with the same capabilities switched off and the same leavers still assigned, and calling that continuity.

Sources (verified): list prices before and after for the with Teams and without Teams suites, prices of the standalone components (Microsoft 365 Apps, Apps for Business, Entra Plan 1, Windows E3, EMS E3), increase percentages, effective date (1 July 2026), capabilities added per suite and the named list of those completing rollout by 1 August 2026 — Microsoft's official "Microsoft 365 Pricing and Packaging Updates" page. Application to existing customers at the first renewal after 1 July, on both monthly and annual billing, and per-tenant advance notice in the Message Center for the repackaging — official FAQ. Contents of Microsoft 365 Business Premium (Intune Plan 1, Entra ID with policy-based identity and access management, Defender for Business, Defender for Office 365, Purview), its 22-dollar price and the 300-user cap on Business plans — Microsoft product page. Teams unbundling (new subscription structure effective 1 October 2023 for the European Economic Area and Switzerland; already-subscribed customers "may continue to use suites to which they have already subscribed without any impact") — Microsoft's official licensing notice. Prices are list prices, in US dollars, per user per month; in Spain billing is in euros and each channel applies its own rates, so the figures show magnitude and direction, not the exact amount on any given invoice. The headcount multiplications, the reading of the Standard-to-Premium step across both tables and the five things to do before renewing are ours.