Tag: technology

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Microsoft announce 2026 price increases


Following Microsoft’s Ignite 2025 conference, they have announced some feature additions to Microsoft 365…and some price increases to go along with it.

Copilot Chat

This free entry point to Copilot, included with various Microsoft products, will have new features to work with Outlook inboxes and calendars and standard access to Agent Mode. There will also be additional management and security capabilities around Copilot Chat.

Enhancing Copilot Chat makes sense as an entry point into M365 Copilot…effectively a “freemium” model albeit in a product you’re already paying for.

Addition Security Features

Microsoft Defender for Office 365 Plan 1, currently only available with Microsoft 365 E5, is being added to:

  • Microsoft 365 E3
  • Office 365 E3

It appears that all features are being added but that is to be confirmed.

Furthermore, URL checking features are being added to Office 365 E1, Business Basic, and Business Standard. The Business SKUs (including Premium) are all getting 50GB email inboxes too.

Boosting the security capabilities of lower SKUs is a welcome move, given the importance of security in today’s tech world.

Endpoint Management

A range of Microsoft Intune products are being added to both Microsoft 365 E3 and E5, these are:

  • Intune Plan 2
  • Intune Advanced Analytics
  • Intune Remote Help

While M365 E5 will also receive:

  • Intune Endpoint Privilege Management
  • Enterprise Application Management
  • Microsoft Cloud PKI
https://www.microsoft.com/en-us/microsoft-365/blog/2025/12/04/advancing-microsoft-365-new-capabilities-and-pricing-update/

Security Copilot and Microsoft 365 E5

The Microsoft announcement also talks about the adding of Security Copilot SCUs to Microsoft 365 E5. I covered that a few weeks ago here – https://cloudywithachanceoflicensing.com/2025/11/20/microsoft-security-copilot-scu-included-with-microsoft-365-e5/

2026 Pricing

Of course, these new features come at a cost. Pricing for the included suites will be increasing as of July 1, 2026 (aka Microsoft’s new financial year)…even Microsoft 365 E5.

https://www.microsoft.com/en-us/microsoft-365/blog/2025/12/04/advancing-microsoft-365-new-capabilities-and-pricing-update/

M365 E3 increases by 8% and M365 E5 by 5%. An organisation with 15,000 E5 SKUs will see an increase of $1.6 million over a 3-year contract – so understanding how the additional features may work for you will help you decide what steps to take at renewal.

Something that I did notice is that, while there is no mention of new features being added to the Frontline Worker F SKUs, they too are increasing in price – with M365 F1 rising by 33% and M365 F3 by 25%.

8,000 F3 users will lead to an increase of almost $600,000 over 3 years…seemingly with no new features to show for it.

Note as well that these increases will also apply to non-profit pricing.

See the Microsoft post here – Advancing Microsoft 365: New capabilities and pricing update | Microsoft 365 Blog

What’s it all about?

ARPU (Average Revenue Per User) is a key metric for Microsoft (and all SaaS publishers) and this will help keep that growing for several more quarters through their next financial year and beyond. Increasing the amount they earn from each user is key to driving shareholder value…especially as the amount of new users to buy M365 licenses is decreasing. Higher pricing also increase the Customer Lifetime Value (CLV), another important metric that helps businesses plan future campaigns and initiatives.

There is the risk that customers will become angry and disillusioned and look for alternatives. However it’s likely that Microsoft are confident in their view that there are very few real alternatives to many of their products and, even when they are available, the time and effort involved in swapping will discourage most organisations. While some may leave, the increased revenue from those who stay will more than offset the losses.

For some organisations, the additional products in E3 and E5 may mean that they can reshape their licensing slightly – dropping additional SKUs or possibly even dropping from E5 to E3. However, it is yet another price increase from Microsoft…particularly galling if you don’t need or want those additional features. Review your Microsoft budget projections and work to lock in the lower pricing for as long as possible.

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Microsoft SQL Server 2025 Failover Rights – staying or going?


Microsoft released SQL Server 2025 on November 18th 2025 and updated the Product Terms. However, the update has caused confusion and consternation amongst the Microsoft community – as it seems to suggest that failover rights as a Software Assurance benefit have been removed!!! 😱 (Spoiler alert – it’s almost certain they haven’t).

If you’re not familiar with this right it means, in a nutshell, that organisations who purchase SQL Server licenses with Software Assurance (SA) may license additional servers at no extra cost, as long as those servers are used only for disaster recovery/failover purposes. This is a long standing and widely used benefit – removing this right will mean one of 2 things:

  • Organisations’ SQL Server licensing will double/triple by millions of £/$/€ more per year
  • Organisations will be forced to have less resilient SQL Server systems, potentially leading to more downtime and lost revenue

Ultimately, if either of those were the case, I believe it would lead to a mass exodus of SQL Server customers. Microsoft may hope they would move to SQL Azure/SQL Server enabled by Azure Arc but I’d expect many to explore other options – Oracle, Postgres, Amazon RDS etc.

Largely because of that, and the fact that we have seen an increase in Product Terms errors over the last couple of years, I’m of the opinion that it is an error and will – eventually – be corrected…but it is worth looking at anyway.

As I was about to press publish, Peter Van Uden has commented on LinkedIn that he’s had confirmation that it is an error and will be corrected in the coming days.

Fellow Microsoft watcher Alex Golev noticed that the whole section had been deleted without replacement:

Other parts of the Product Terms still refer to this section which suggests this is an erroneous deletion…but it could also mean that they just didn’t edit those sections correctly.

This Microsoft page – https://www.microsoft.com/licensing/guidance/SQL?msockid=144db73d53b469e721fda347528468b6 which is licensing guidance for SQL Server 2025 still contains the failover rights information:

I genuinely believe this is an error. It is a huge change that would have significant consequences for most Microsoft customers, including their largest and most significant customers. Making this change would be an enormous risk and to do so without any official announcement or warning is unbelievable. I’m sure we’ll see a reversal in the coming days and that’s why I haven’t posted about this already.

However, I feel it does highlight the increasingly slapdash approach that has been taken to the Microsoft Product Terms since it became an online site, rather than document downloads. It seems likely to me that updates are being made by people with little understanding of software licensing and so they don’t see the consequence of their actions.

The fact that it’s 4 days since this change was made and there has been no word from Microsoft is disappointing – but hopefully that correction will appear soon.

So, don’t panic but do remember that these things happen and that Microsoft experts like me, Alex, Peter and more can be very useful in these scenarios. 😁

Update: The missing text has been reinstated so the panic is over. It does highlight the need for us all to be vigilant in the future though.

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Microsoft announce new European Cloud options


Microsoft announce new cloud options for Europe. There is an increasing push back from European organisations, particularly Government, against so many critical services and so much data all being run out of the US…this has been accelerated by the current geo-political situation too.

These announcements are Microsoft’s attempt to pre-emptively stem the flow of European customers away from their cloud services.

Altogether we’ve got:

  • Sovereign Public Cloud
  • Sovereign Private Cloud
  • National Partner Clouds
  • Microsoft 365 Local
  • Data Guardian
  • External Key Management
  • Regulated Environment Management

Microsoft 365 Local is interesting but the MS announcement only talks about productivity workloads like Exchange Server & SharePoint Server. Does M365 Local include Teams, Stream, ClipChamp, Planner etc.? 🤷‍♂️

Sovereign Public Cloud

Will be offered across all existing European datacentre regions, for all European customers, across enterprise services such as Microsoft Azure, Microsoft 365, Microsoft Security and Power Platform.

Customer data stays in Europe, under European Law, with operations and access controlled by European personnel, and encryption is under full control of customers.

Sovereign Private Cloud

Will support critical collaboration, communication and virtualization services workloads on Azure Local. This solution now integrates Microsoft 365 Local and the security platform with Azure Local, providing consistent capabilities for hybrid or air-gapped environments to meet resiliency and business continuity requirements

National Partner Clouds

Available in France (Bleu) & Germany (Delos Cloud), these will offer comprehensive capabilities of Microsoft 365 and Microsoft Azure in an independently owned and operated environment.

Microsoft 365 Local

Microsoft 365 Local provides customers with additional choice by bringing together Microsoft’s productivity server software into an Azure Local environment that can run entirely in a customer’s own datacentre.

This provides a simplified deployment and management framework for organizations to run Microsoft’s trusted productivity servers in environments they fully control. It remains to be seen exactly what is included and how the licensing works…

Data Guardian

Data Guardian will add an additional level of assurance by ensuring that only Microsoft personnel residing in Europe control remote access to these systems and adds additional human and technical oversight whenever engineers outside of Europe need access.

All remote access by Microsoft engineers to the systems that store and process your data in Europe is approved and monitored by European resident personnel in real time and will be logged in a tamper-evident ledger.

External Key Management

With external key management, customers can connect Azure to keys stored on their own Hardware Security Module (HSM) on-premises or hosted by a trusted third party.

Regulated Environment Management

The Regulated Environment Management service will allow customers to easily manage all these features in one place (for instance, configuring Data Guardian policies or reviewing access log entries).

The Microsoft announcement is here.

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Microsoft vs CISPE: An agreement


Microsoft & CISPE have come to an agreement which takes some of the legal pressure off Microsoft and should lead to a more diverse cloud market…to a point.

Background

CISPE (the Cloud Infrastructure Service Providers in Europe) is, as its name suggests, a group comprised of, and working for, European Cloud hosting organisations including AWS, OVH, and Aruba.

In November 2022, CISPE filed a formal complaint with the European Commission about Microsoft’s “anti-competitive licensing practices” in the cloud. CISPE said:

“the new contractual terms imposed unilaterally by Microsoft on 1st October 2022 add new unfair practices to the list. Microsoft’s ongoing position and behaviours are irreparably damaging the European cloud ecosystem and depriving European customers of choice in their cloud deployments.”

The crux of the issue is that Microsoft’s licensing rules make it cheaper to run Microsoft workloads in Azure than any other cloud environment, thus giving them an unfair advantage against their competitors.

What’s happened now?

The two parties have signed a Memorandum of Understanding (MoU) where Microsoft have committed to make changes to address the claims and so CISPE have agreed to withdraw its complaint and also that they “will not initiate or support complaints on these issues in Europe or elsewhere”. Microsoft have also agreed to pay $22 million to CISPE to reimburse them for the last 3 years’ of “cost of litigation and campaigns for fair software licensing”.

Central to the agreement is Microsoft agreeing to release “Azure Stack HCI for Hosters”. This new Azure Stack HCI offering will include:

  • Multi-session virtual desktop infrastructure based on Windows 11
  • Free Extended Security Updates (ESU)
  • Pay-as-you-go licensing for SQL Server

Enabling 3rd-party cloud providers to close the gap between their services and those available in Microsoft Azure – a key part of the complaint.

There is a clock ticking for Microsoft now, as changes must be made within 9 months. They must release this new offering and/or solve the issues another way within that timeframe otherwise the complaint will be refiled with the European Commission.

It must be noted that CISPE state:

“Amazon Web Services, a CISPE member, was excluded from these negotiations and it, along with Google Cloud Platform and AliCloud, will neither benefit from nor be bound by these terms”

This means Microsoft’s “Listed Provider” exclusion still applies to this change.

European Cloud Observatory (ECO)

This new body, established by CISPE and including Microsoft, will monitor the development of “Azure Stack HCI for Hosters” and the fairness of Microsoft’s cloud licensing.

Reception

Not everyone is happy with this outcome. It has been reported that Google made an offer to CISPE worth almost $500 million, comprised of licenses and cash, for them to continue their compliant against Microsoft.

Additionally, Google’s Head of Platform, Amit Zavery, has said:

“Microsoft’s playbook of paying off complainants rather than addressing the substance of their complaint hurts businesses and shouldn’t fool anyone“

while an AWS spokeperson stated:

“Microsoft selectively making these changes for some CISPE members shows that there are no technical barriers that prevent Microsoft from making its software more easily available to rival cloud providers”

What’s next?

The Azure Stack for Hosters product will enable cloud providers to offer new features and capabilities that are attractive to customers, which is good. The main issue that many people may have is that this agreement excludes Amazon AWS and Google Cloud Platform, so their customers are no better off than before.

While that is true, I think it is also representative of what I believe is CISPE’s main aim – to help boost the non-hyperscaler cloud market in Europe. They want to help companies like OVH, Irideos, and UpCloud more so than Amazon and Google.

This is certainly not the end of this story. The cloud is going to be a battleground for many years to come and so licensing and competitive advantages will be a key issue for some time…

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