February Microsoft Licensing Update: Pricing and Billing Changes

Microsoft continues to roll out licensing and pricing updates in 2025, with several key changes taking effect on April 1.

About this episode

February’s update focuses on four specific developments, one already implemented and three more scheduled in the coming weeks. These changes affect how organizations manage subscriptions, billing models, and impact IT cost management.

This month's episode outlines what is changing, when it takes effect, and how to prepare ahead of upcoming renewals. 

Microsoft Product Price Changes

• Copilot for Microsoft 365
  As of December 1, 2024, Copilot for Microsoft 365 can now be billed monthly while still maintaining an annual term. This change offers more flexibility but comes with a 5 percent price increase. Existing subscriptions must complete their current term before switching to the new billing model.
• Microsoft 365 and Dynamics 365
  Starting April 1, 2025, Microsoft will apply a 5 percent price increase to subscriptions billed monthly on annual or triennial terms. This change affects Microsoft 365 (including Business Premium, E3, and E5) and Dynamics 365. Organizations that commit to annual or triennial prepayment can avoid the uplift. Subscriptions started before April 1 will retain current pricing through the end of their term.
• Teams Phone
  Teams Phone pricing will increase from $8 to $10 per user per month beginning April 1. This applies to both new and renewing subscriptions. As with other products, monthly billing on an annual term will include the additional 5 percent uplift.
• Power BI
  Power BI pricing will rise from $10 to $14 per user per month starting April 1. The same billing structure applies: monthly payments on annual terms will include the 5 percent increase.

Make the Most of Your Renewal Window with Sourcepass MCOE 

These pricing changes reflect Microsoft’s broader shift toward standardized billing models across its cloud services. With multiple increases taking effect on April 1, now is the time to review subscription terms, evaluate renewal timing, and consider opportunities to manage costs more strategically.

For ongoing updates like this, subscribe to our YouTube channel for our monthly Microsoft podcast. Our Microsoft licensing consultants continue to monitor these developments to help organizations stay informed and in control of their licensing decisions.