With over a 1,000 new features and updates across the Microsoft 365 stack in the last couple of years, Microsoft has confirmed that the commercial Microsoft 365 suite will undergo pricing increase from July 1, 2026.
This follows “adjustments” to Personal and Home subscriptions at the end of the summer, and now the Enterprise/Commercial side is being reshaped to reflect the growing set of features delivered in the suite especially around AI and Security which have both had significant investments and updates.
For customers, partners, and technical teams, the key is not just to note the new numbers, but to understand how to plan ahead, optimise licensing, and make sure you’re getting the most value from the platform.
Updated Microsoft 365 Pricing from July 2026
| Microsoft 365 Suite | Current List Price | List Price (July’26) | % Increase |
| Business Basic | $6.00 | $7.00 | 16.67% |
| Business Standard | $12.50 | $14.00 | 12% |
| Business Premium | $22.00 | $22.00 | 0% |
| Office 365 E1 | $10.00 | $10.00 | 0% |
| Office 365 E3 | $23.00 | $26.00 | 13% |
| Microsoft 365 E3 | $36.00 | $39.00 | 8.33% |
| Microsoft 365 E5 | $57.00 | $60.00 | 5.26% |
| Microsoft 365 F1 | $2.25 | $3.00 | 33.33% |
| Microsoft 365 F3 | $8.00 | $10.00 | 25.0% |
What’s Driving the Change
As usual with such price changes, they will apply globally with local market adjustments for our commercial products and nonprofit pricing will be adjusted in line with commercial pricing
Microsoft is pointing us to understand and recognise the value and breadth of new features delivered across the suite. Recent additions include:
- Copilot Chat (which always has the latest AI models available at no cost) now embedded across Word, Excel, PowerPoint, Outlook, and OneNote, with inbox and calendar understanding plus Agent Mode for iterative document and presentation creation.
- Microsoft Loop and Copilot Notebook feature as well as huge updates and simplification of add on suites.
- Security improvements such as Defender for Office P1 expanded to E3, URL checks added to E1 and Business SKUs, and Security Copilot embedded directly into Defender, Entra, Intune, and Purview for E5 customers.
- Management tools like Intune Remote Help, Advanced Analytics, and Intune Plan 2 now included in E3/E5, with Endpoint Privilege Management and Cloud PKI in E5.
Looking Beyond the Price
Whilst many will look at this and think “wow that’s already expansive”, it’s important to look beyond this as just a greedy cost increase.
Microsoft like to remind us of the extent of new features added across the stack and the value these product suites still bring.
Whilst many will naturally re evaluate the value proposition (which they should), it is worth considering the wider business value of Microsoft 365 and this is a good time to take stock, keep calm and review the value of the suite and your other technology and subscription investments.
- Consolidation of tools: Many organisations still pay for third-party add-ons for endpoint management, analytics, or security. With the Intune Suite now bundled into E3/E5, there’s an opportunity to simplify and reduce spend.
- Security Copilot: AI-driven security capabilities are now part of the platform, reducing the need for separate tools and helping teams respond faster.
- Integrated management: A single, consistent approach to endpoint, identity, and compliance reduces complexity compared to juggling multiple vendors.
Re-Evaluating the Business Value.
Via your Microsoft Partner, it’s worth looking beyond the cost and looking at structured tools like a business case builder to quantify the impact and refresh the value of the software tools you use across the business. It’s also worth looking at all your other subscriptions to see what duplicate products/tools you have as well as what tools you own but don’t use (or even know about).
These help weigh not just the headline subscription costs, but the wider opportunity to consolidate vendors, reduce duplication, and strengthen compliance…and adopt what you have invested in!
Security and compliance are prime areas for this conversation.
- IDC forecasts global security spending will reach $377 billion by 2028, growing at over 12% year-on-year. Much of this spend is fragmented across multiple point solutions, with organisations often layering overlapping tools for endpoint, identity, and compliance.
- Gartner projects worldwide information security and risk management spend will hit $213 billion in 2025, rising to $292 billion by 2028. At the same time, Gartner highlights that enterprises are juggling more SaaS applications than ever, with tool sprawl creating duplicate spend, compliance blind spots, and security risks.
Whilst there is an argument for not putting all ones “security eggs” in the same basket, many organisations have many duplicate security and compliance tools. This is not just a financial issue – it creates operational drag. Multiple consoles, inconsistent policies, and siloed reporting make it harder for IT and security teams to respond effectively.
In contrast Microsoft 365’s integrated approach with Intune Suite for endpoint management and Security Copilot embedded across Defender, Entra, Intune, and Purview offers a path to reduce reliance on third-party add-ons. Consolidation here can mean:
- Lower total cost of ownership by retiring duplicate tools.
- Improved compliance posture through consistent policy enforcement.
- Simplified management with fewer contracts, renewals, and integrations to maintain.
Preparing for the change
- Talk to your licensing partner to understand the impact on your organisation.
- Explore price lock-in options on longer-term SKUs to mitigate the increase – before July 26.
- Optimise and right-size your licensing to ensure you’re not paying for unused features.
- Review where Microsoft 365 can replace standalone products from endpoint management to security to unlock better value and integrated management.
- Use a business case builder to model the cost of current third-party tools against the integrated capabilities now included in Microsoft 365.