Microsoft has announced upcoming pricing increases and packaging changes across Microsoft 365 Business, Enterprise and Frontline suites, with pricing changes applying from 1 July 2026 and new features rolling out from June.

Since the announcement, we’ve had a steady stream of the same question: “Are we about to pay more… and if so, for what?”

For many organisations, the answer will be yes, at renewal. But in practice, the more important consideration often isn’t the increase itself, it’s whether licences are renewed without first reviewing how well they still reflect the way the business operates today, particularly with additional security, device management and AI‑related capabilities being added into select existing suites.

Below, we break down what Microsoft has announced, what’s changing and what it practically means for your organisation.

 

Why Microsoft is making these changes

Microsoft has positioned these updates as reflecting additional functionality delivered over the past several years, particularly across security, device management and AI.

As Microsoft explains: “This change reflects the significant innovation delivered over the past several years and the expanded value customers will gain with new additions to the suites, including major advancements in AI, security and IT management.”

Microsoft has also confirmed these changes:

• Apply globally, with local market adjustments
• Take effect at renewal for existing customers
• Are separate to earlier changes around Microsoft Teams licensing

 

When the changes take effect

• Pricing changes: Effective 1 July 2026
• Packaging updates: Begin rolling out from June 2026
• Existing customers: New pricing applies at your next renewal after 1 July 2026
• Microsoft will provide at least 30 days’ notice via the Message Centre before packaging changes take effect

 

What Microsoft means by “packaging updates”

Alongside pricing changes, Microsoft is also updating what’s included inside Microsoft 365 plans. From mid‑2026, Microsoft will progressively roll out packaging updates that bring additional security, device management and foundational AI capabilities directly into certain Microsoft 365 suites. These features, which were previously available as separate add‑ons or only in higher‑tier plans, are being consolidated into the core platform. 

For organisations, the upside is a more complete, better‑integrated Microsoft 365 experience with stronger protection and management built in, rather than layered on. These updates are introduced gradually with advance notice provided via the Microsoft Message Centre and pricing changes still apply at renewal, not immediately.

Microsoft announced that the “roll out of the following features will be complete by August 1, 2026: Microsoft Defender for Office 365 Plan 1, Intune Remote Help, Intune Advanced Analytics, Intune Plan 2, Intune Privilege Management, Microsoft Cloud PKI, and Intune Application Management.”

 

Microsoft 365 Business plans

Percentage increases announced for Microsoft 365 Business plans highlight an important detail, as it changes the relative gap between plans. 

Business Suites – Pricing Updates

Closing the gap: Standard vs Premium

A simple scenario that is becoming increasingly common. You’re on Microsoft 365 Business Standard today… From July 2026, Business Standard increases by around 12–16%, depending on the variant. At the same time, Business Premium does not increase.

That leads many organisations to ask: “If Standard is increasing anyway, does Premium start to make more sense?”

The percentage difference between Standard and Premium shrinks noticeably after July 2026. What was previously a larger jump now feels more like a step up, rather than a leap.

More importantly, Business Premium includes additional capabilities that businesses often start paying for separately as they mature. 

• Identity and access controls (Microsoft Entra capabilities)
• Enhanced protection against phishing and malicious links
• Built‑in endpoint protection for laptops and desktops
• Device management for user-owned and company devices

“Business Standard focuses on productivity while Business Premium adds control and protection,” explained Gavin Hall, Business Technology Consultant, Diamond IT. 

 

When upgrading usually makes sense

In practice, the upgrade conversation tends to come up when an organisation says things like:

• “We need better control over remote access.”
• “Security insurance requirements are getting stricter.”
• “We’re worried about phishing and credential compromise.”
• “We want visibility and control over devices accessing company data.”

At that point, the question isn’t whether to invest more in security, it’s where that investment should sit.

“For a lot of customers, the Standard increase is simply the prompt to re‑check whether Standard still matches their risk profile. If you’re already planning to strengthen security controls, Business Premium can be a cleaner way to bring more of that into the Microsoft 365 platform you’re already using,” added Gavin.

 

Microsoft 365 Enterprise & Frontline plans

Microsoft has also announced increases across several Enterprise and Frontline plans including E3, E5 and Frontline SKUs, applying at renewal from July 2026.

Enterprise Suites – Pricing Updates

Frontline Suites – Pricing Updates

Frontline Suites – Feature Additions

Standalone Microsoft Components

Microsoft has also announced price changes to select standalone components that are commonly used alongside Microsoft 365. These standalone licences are typically reviewed as part of broader renewal or licensing conversations, particularly where organisations have built additional security, identity, or device management capabilities around their core Microsoft 365 plans.

As with suites, pricing changes apply from 1 July 2026, at renewal.

Pricing Updates

Feature Additions

The real consideration isn’t the increase, it’s renewing without reviewing

For most organisations, the real consideration isn’t the increase itself. It’s renewing existing licences without first confirming they still reflect how the business operates today.

We regularly see environments where:

• Users are licensed above their actual needs
• Licences remain assigned to inactive accounts
• Standalone security or reporting tools overlap with Microsoft 365 capabilities

This makes the period before renewal the right time to:

• Review licence allocation
• Confirm what features are actually being used
• Check whether your current plan still fits how your people work