“Price Harmonization,” - Microsoft price rises coming in 2023

Microsoft

“Price Harmonization,” - Microsoft price rises coming in 2023

Microsoft price rises are coming in 2023. In an effort to “become more agile”, Microsoft have announced they will begin a new process to “harmonize” their global pricing to the US dollar. This will, according to Redmond, give customers “more consistent pricing” wherever they’re based.

They say that, in some regions, local pricing was up to 40% lower than USD and so, from 2023, they will refine pricing every 6 months. They have stated that prices will be aligned “up or down” so those of you in regions currently paying over the USD price (Australia for example) could be in for savings…although that’s perhaps an “I’ll believe it when I see it” moment!

What is affected?

Microsoft focus mainly on “Commercial Cloud” in their communications but on-premises products will be included too. However, Microsoft say that a range of local factors will also be considered in those locations including business models, competition, and local inflation.

APAC changes

In addition to the above, Microsoft price rises are coming to in Japan & Korea from April 1, 2023. The changes will be:

• Japan
  • On-premises: 20% increase
  • Online services: 15% increase
• Korea:
  • On-premises: 15% increase
  • Online services: 11% increase

See more details here:

Japan – https://learn.microsoft.com/en-gb/partner-center/announcements/2022-november#2

Korea – https://learn.microsoft.com/en-gb/partner-center/announcements/2022-november#3

SQL Server 2022

Microsoft have also confirmed that SQL 2022 Standard, Enterprise, and Web will see a 10% price uplift from January 2023 – this includes public sector pricing.

Conclusion

Those of you with long-term contracts such as an Enterprise Agreement won’t be affected immediately but, when you come to add new products and/or renew your agreement, the new (likely higher) pricing will be in effect. Remember, there were Office 365 price increases in March 2022 as well (of up to 25% in some cases) which will kick in at your next renewal too.

Make your senior management and stakeholders aware that this is happening and that there will be a 6 month cadence from now on, as this will need to be accounted for in budgets and future planning. Model how the pricing will impact your organization and see where you may be able to mitigate some price increases through right-sizing and tightening up processes etc.

At a time of rising inflation, sky-rocketing energy costs, looming recessions and more – there is potential for these (and other vendor) price increases to really make a material impact on organizations across the globe.

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