Microsoft AU Price Increase: What You Need to Know

Back in 2022, Microsoft announced it would start aligning global prices with U.S. dollar rates. For Australian businesses, that meant a Microsoft price increase of around 9% on licences like Microsoft 365 Business Premium and Enterprise by September 2023. 

Now in 2025, pricing updates are still rolling out. And they’re reshaping how organisations of all sizes budget for software and manage their IT spend.

If you’re using Microsoft 365 or other cloud services, these changes affect more than just the line items on your invoice. They impact long-term cost planning, subscription choices, and even the way businesses think about licensing strategies. 

Understanding what’s driving the increase, who it affects, and how to respond will help you stay ahead of rising costs. So keep reading and let’s break it all down. 

What’s new in 2025?

In April 2025, Microsoft updated how it bills annual subscriptions. If your business is on an annual plan with monthly payments, your next renewal will automatically include a 5% price increase. This means spreading payments over the year now comes at a slightly higher cost.

Paying the full annual fee upfront avoids the extra 5%, giving you a lower overall rate for the same subscription. For businesses that can budget ahead, this is a simple way to save money, lock in predictable costs, and simplify billing.

For IT managers and finance teams, this update affects more than just invoices. It influences renewal strategies, cash flow planning and long-term licensing costs. So weighing upfront payment against monthly installments can make a real difference to your bottom line.

Note: Like the Swiss Franc, some prices can decrease depending on currency fluctuations, local market conditions, and inflation.

Who feels the Microsoft price increase the most?

The Microsoft price increase impacts certain subscriptions more than others. Monthly-billed annual plans see the most noticeable increase. While businesses paying upfront for the full year maintain their current rates for the term.

Add-ons are also taking a bigger slice of the budget. Power BI licences, for example, have surged by up to 40%, and Teams Phone has climbed around 25%. 

For organisations relying on these tools, costs can rise quickly. This makes it crucial to review your subscriptions, consider consolidating where possible, and plan renewals carefully.

Billing update summary

Here’s a quick look at how the April 2025 billing changes affect different plans:

What does this mean for you?

Rising subscription costs aren’t just numbers on a bill. They affect how your business budgets, plans and manages IT resources. If your licences renew soon, now’s the time to take stock.

Consider whether monthly billing still makes sense. Switching to upfront annual payments locks in existing rates and removes the 5% surcharge, giving your finance team greater predictability.

It’s also a good moment to assess which add-ons are actually necessary. With services like Power BI and Teams Phone climbing significantly in price, trimming unused or underused licences can free up your budget without impacting productivity.

Finally, these changes highlight the value of planning ahead. By reviewing subscription needs, timing renewals strategically, and consolidating where possible, your business can keep costs under control, even as Microsoft pricing continues to evolve.

Which programs are impacted?

Not all subscriptions are affected in the same way. The 2025 price updates apply to a range of commercial licensing programs. These include:

• Enterprise Agreement (EA) – Commercial, Government, and Education Solutions
• Microsoft Customer Agreement for Enterprise (MCA-E) – seat-based offers only
• Cloud Solution Provider (CSP) with MCA – seat-based offers only (Commercial, Government, and Education Solutions)
• Legacy CSP Open Value – Commercial, Government, and Education Solutions
• Open Value Subscription – Commercial, Government, and Education Solutions
• Microsoft Products and Services Agreement (MPSA) – Commercial, Government, and Academic
• Microsoft Online Services Portal (MOSP)
• MCA Online
• Select Plus

Not sure if your licences are affected? Your ADITS Account Manager can check for you and explain what the changes mean.

The Microsoft licences and services that remain unchanged

Not everything sees a price hike. Here’s a look at the licences and services that remain unaffected:

• Azure via Microsoft Customer Agreement (MCA): Azure pricing is set in U.S. dollars, but billed in your local currency, with rates recalculated monthly. This means licences aren’t affected by the price increase.

• Existing commercial agreements with price protection: If your business already has orders under agreements with price protection or locked enrollment prices, those products won’t increase in price. Keep in mind, however, that new products, upgrades, renewals or contracts will follow the updated rates. 

• Hardware and consumer software/services: Devices, consumer software and consumer cloud subscriptions are not affected by the Microsoft price changes.

Take control of your Microsoft licensing costs

Rising subscription prices and billing changes don’t have to catch your business off guard. With ADITS, you get a partner who helps you review your licences, identify unnecessary add-ons, and choose the payment options that save money and simplify budgeting.

If you want clarity, predictability and smarter Microsoft 365 management, reach out to our friendly team today! We’re here to help you plan, protect your budget, and make informed licensing decisions for your business.