Microsoft 365 Price Increase: What It Means for Your Business and Why Now Is the Time to Review Your Licences

From 1st July, Microsoft will introduce a price increase across selected Microsoft 365 plans. Business Basic and Business Standard licences are expected to rise by around 10 to 15%. This shift aligns with Microsoft’s broader strategy to position premium plans as the default choice, supported by ongoing investment in AI, security, and productivity features. 

For most businesses, this is not just a pricing update. It is a moment to take a closer look at how licences are being used, where money is being lost, and whether the current setup still reflects how people actually work.

Why Microsoft is increasing prices

Microsoft has been steadily expanding what sits inside Microsoft 365. The addition of Copilot capabilities, deeper integrations across apps, and stronger security features all come at a cost. According to Microsoft’s own announcement, the pricing update reflects “continued innovation and added value” across the platform. Many businesses are not using what they already pay for. Licensing often grows in the background. New starters join, leavers are not fully offboarded, roles change, and licences remain untouched. Over time, this creates a gap between what a business pays for and what it actually needs. A price increase exposes that gap very quickly.

The hidden cost of ghost licensing

Ghost licensing is more common than most organisations realise. It usually shows up in a few ways:

• Licences assigned to former employees.
• Duplicate licences across overlapping roles.
• Users with higher-tier plans than they need.
• Inactive accounts that still consume licences.

Individually, these do not look like major issues, but they can add up. A 50-user company with just 5 unused licences could waste hundreds or even thousands per year. Add a price increase into that equation, and the cost compounds without delivering any additional value. In addition, poor licence management also creates security risks. Dormant accounts can become easy entry points if they are not properly monitored or removed.

What this means ahead of 1st July

If your business does nothing, your Microsoft costs will increase overnight. If your licensing is already optimised, the impact stays controlled. If it is not, you end up paying more for inefficiencies that already exist. Reviewing licences before the price change allows you to reduce unnecessary spend before the increase takes effect. Waiting until after means you absorb higher costs first, then try to correct them later.

Where most businesses go wrong

Licence reviews often get treated as a one-off admin task. Someone exports a report, checks a few users, and moves on. A proper licence review looks at how people actually work. It asks questions like:

• Does each user have the right licence for their role
• Are there features being paid for but never used
• Are there opportunities to consolidate or simplify plans
• Are security and compliance needs properly covered

Without that context, it is easy to either overspend or cut back in the wrong areas. For example, some businesses downgrade licences to save money but lose key security features in the process. Others keep everyone on the same plan for simplicity, even when needs vary significantly across teams.

Both approaches create problems. A structured review can help you:

• Remove unused or duplicate licences.
• Align plans with actual user needs.
• Identify where premium features deliver real value.
• Strengthen security without unnecessary spending.

In many cases, businesses find that they can offset part or all of the price increase through optimisation alone.

How Fitzrovia IT approaches licence reviews

At Fitzrovia IT, we treat licensing as part of a wider operational picture, instead of treating it as just a list of subscriptions.

Our approach focuses on three areas.

First, we analyse your current licence estate in detail. This includes active users, inactive accounts, and how licences are assigned across the organisation. Second, we map licences to real usage. We look at how employees use Microsoft 365 day to day, not just what they have access to. Third, we provide clear recommendations. These are practical changes that reduce waste, improve alignment, and ensure security requirements are met.

The goal is to give you a clean, efficient setup that reflects how your business actually operates.

Free licence reviews ahead of the price increase

To support businesses ahead of the 1st July change, we are offering free Microsoft 365 licence reviews.

This is a straightforward way to understand:

• Where you may be overpaying
• Whether your current licences match your needs
• How to prepare for the upcoming price increase

Final thought

Microsoft will continue to evolve its platform, and pricing will move with it. That is unlikely to change. What you can control is how efficiently your business uses what it pays for. 

With the 1st July increase approaching, it is a sensible time to take a closer look. (Read more about Microsoft's price increase here)