Microsoft price increases are coming – again. They have announced they will be performing “price harmonisation” in 2023 – where they will be bringing local currency pricing in line with US Dollar (USD) pricing. They say this is to give customers “more consistent pricing”, but I’d say it mainly to stop organisations purchasing in regions other than their primary location.
They state that some products in some regions are up to 40% cheaper than the US pricing and I believe the Euro is around 15% cheaper. Once the initial adjustment is made, Microsoft will continue the process on a 6-monthly cadence going forward to keep ensuring local pricing doesn’t drift too far from USD again. They do say that prices will be “aligned up or down” so it will be interesting to see what happens to pricing in regions such as Australia that typically pay more than USD for more products.
While the focus of the announcement is cloud pricing, on-premises software pricing will also be affected although Microsoft will consider “local and regional market dynamics including competition, business models, local currency rates and local inflation” – which includes rising energy costs.
More changes for Japan & Korea
Alongside the above, Microsoft have also revealed they will be revising pricing across all products (on-premises and cloud) in Japan & Korea from April 1, 2023. The increases are as follows:
Japan
- On-premises = 20% increase
- Online services = 15% increase
See Japanese announcement here.
Korea
- On-premises = 15%
- Online services = 11%
Future impact
Those of you with long-term contracts such as Enterprise Agreements won’t be affected until your renewal (or if you add new products) but now is the time to start planning how this will alter budgets over the next few years. Also, don’t forget the O365/M365 price increases in March 2022 that will also kick in on certain products you may have on your contract.
Update
An announcement on Jan 5th, 2023 for price increases across GBP, EUR, DKK, NOK, SEK currencies.
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