If your business runs on Microsoft 365, you’ve probably heard the news: price increases are on the way. It’s always a little stressful when costs go up, but there’s more to this update than just sticker shock. Let’s walk through what’s changing with Microsoft 365 pricing in 2026, what it means for your organization, and why this might be a good moment to rethink your subscription plan.
What’s Changing with Microsoft 365 Pricing in 2026?
Microsoft recently announced that pricing for their popular 365 subscriptions will increase starting July 1, 2026.
First off, the new pricing only takes effect after your next renewal date following July 1, 2026. Even if you pay monthly, you may already be committed to an annual term. In that case, the higher rates won’t apply until your term renews.
The percentage increase varies between packages. Here are a few of the most common Microsoft 365 SKUs and their new prices:
How much each license is climbing.
Microsoft’s price increases vary by SKU, with smaller plans seeing the steepest percentage jumps. Here’s how the four most common business licenses compare.
For many businesses, Microsoft 365 is essential, so it’s worth understanding how these changes affect you and whether you’re getting the most value from your subscription. Microsoft is promising feature additions and improvements alongside the price hike. The main callout is an additional 50GB of mailbox space on Business Standard and Business Premium seats, rolling out later in the year. That addition will help offset the cost for clients who may have had to purchase add-on licensing for larger mailboxes.
Why the Business Standard vs. Business Premium Gap Matters
One of the most interesting parts of this Microsoft 365 update is that the price gap between Business Standard and Business Premium is getting smaller. In the past, upgrading to Premium felt like a big jump in cost. Now, with the increase to Standard pricing, the difference is much less dramatic.
That shift makes the Business Premium upgrade more appealing than it has been in years. For just a bit more each month, you get advanced security features, device management tools, and additional compliance capabilities. These benefits can put your mind at ease, especially if your business is growing or you handle sensitive data.
One concrete example: Business Premium allows for conditional access policies that restrict logons to specific regions, immediately reducing your vulnerability and attack surface. With the smaller price gap, it’s a great time to revisit your needs and see if Premium fits your organization better.
Should You Upgrade to Microsoft 365 Business Premium?
If you’ve been sticking with Business Standard because Premium seemed out of reach, now might be the moment to reconsider. With the new pricing, the value you get from Premium’s extra features is even greater compared to the smaller cost difference.
A few questions worth asking your team:
- Are you handling sensitive customer or financial data that needs stronger protection?
- Has your team grown to the point where managing devices and access is becoming complicated?
- Have you dealt with phishing attempts or security incidents recently?
- Do you have remote employees who would benefit from conditional access controls?
If you answered yes to any of these, Business Premium is likely worth a closer look. Think about your team’s needs, your data security requirements, and your plans for growth. Upgrading could be a smart move.
Planning for the Microsoft 365 Price Changes
Price increases are never fun, but they can be an opportunity to make sure you’re getting the most out of your Microsoft 365 investment. Take a look at the new pricing, weigh the benefits of upgrading, and reach out to the BP/IT team for guidance on the right plan for your organization. Change is coming, but with the right plan in place, your business can keep moving forward smoothly.
We think about this stuff a lot here at BP/IT, because we work with businesses just like yours across the I-5 corridor — from Beaverton to the east side, from Lake Oswego to Vancouver to Salem and beyond.
Why Portland Businesses Choose BP/IT for Guidance
We think about this stuff a lot here at BP/IT, because we work with businesses just like yours across the I-5 corridor — from Beaverton to the east side, from Lake Oswego to Vancouver to Salem and beyond.
When Microsoft makes a change like this, your IT partner should be telling you about it before you see the headline. That’s how BP/IT works. For more than 35 years, we’ve been the team Portland-area small and midsize businesses trust to look ahead on their behalf, whether that means licensing shifts, new security threats, or smarter ways to use the tools you already pay for. Our focus stays on one thing: finding the Microsoft 365 setup that fits how your business actually runs, and standing behind that recommendation with local managed IT support, real people who pick up the phone, and a 2-hour service guarantee on every ticket. That’s what being the go-to IT partner in Portland looks like!
Want to know if you’re on the right plan before July 1, 2026? Schedule a call with us today!
