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Microsoft 365 pricing changes: what you need to know

Microsoft 365 is a suite of productivity and security applications that helps you work smarter and stay safer. You can purchase the software for your home or for your business.

However, as of March 1, 2022, Microsoft has raised prices on its software packages by an amount up to 20%. The increase will affect different types of customers, but you can easily prepare your business and budget.

Why did the price increase?

This marks the first substantive pricing increase since Microsoft first launched Office 365 a decade ago. The suite has grown in popularity over the last few years in both the home and business markets.

When Microsoft announced the price update in August last year, the company stated it reflected the increased value the suite has delivered over the past decade in three key areas: communications and collaboration, security and compliance, and AI and automation.

Since Office 365 was launched, the company has added 24 applications and over 1400 new features to the suite – without substantially increasing the price in the subsequent ten years.

Notable additions include:

Microsoft Teams:

A chat-based workspace that fosters in remote workers the same sense of teamwork and collaboration as an in-person office. The chat has feature parity with video and audio calling. It can be used to share content, discuss ideas or make plans. The service is deeply integrated with the Microsoft 365 suite, and as such, it provides a collaborative workspace with many other applications.

Security features:

Data protection, Advanced Threat Detection, device management, and many more cybersecurity features have been included into Microsoft 365 over the years. to address the cybersecurity threats of today and tomorrow. Its security features are designed to protect employees from these threats by offering data loss protection, identity protection, and mobile device management (MDM) at an enterprise level.


Microsoft’s public cloud solution. It provides a wide range of services that help developers build, deploy and manage applications across a global private or public infrastructure that provides compute power, database storage, content delivery network (CDN) capabilities as well as many other high-level services.

What are the new prices?

As of March 1, 2022, the pricing has been updated for the following commercial products:

Business Basic: $6.90 to $8.30 per month, per user

Business Premium: $27.50 to $30.25

Office 365 E1: $11 to $13.80

Office 365 E3: $29 to $34.50

Office 365 E5: $50.70 to $56.30

Microsoft 365 E3: $46.40 to $51.60

Exceptions to the price update

Microsoft has not increased pricing on all of its commercial subscription packages. The above listed packages are the only subscriptions that have had pricing updates; the company has left Microsoft 365 F3 untouched for the benefits of frontline workers.

Other exceptions and changes to this update include:

Find out more from the Microsoft experts

If you’re unsure how your Microsoft 365 subscription will be affected, talk to Microsoft Gold Partner Steadfast Solutions. Their Microsoft consultants can answer any of your questions, or help you find a plan that better suits your business needs.