Microsoft has announced pricing changes to Microsoft 365 that take effect from 1 July 2026. If you're a Perth business paying for M365 licences, this affects you directly.
Here's what's actually changing, what it means for your monthly bill, and what you can do about it right now.
What's changing
Microsoft is increasing prices across most Microsoft 365 Business and Enterprise plans. The increases vary by plan, but the headline numbers are:
- Business Basic: Modest increase — still the most affordable entry point for email and Teams
- Business Standard: The most common small business plan is going up by approximately 10-15%
- Business Premium: Larger increase due to included security and compliance features
- Enterprise plans (E3, E5): Increases of 5-12% depending on the specific SKU
These increases also affect Copilot add-on pricing, which has been adjusted since its initial launch.
Why Microsoft is raising prices
Microsoft hasn't increased M365 pricing significantly in several years, despite adding substantial new features:
- Microsoft Copilot integration across Office apps
- Microsoft Loop for collaborative workspaces
- Microsoft Designer for AI-powered creation
- Enhanced security features including improved Defender and compliance tools
- Microsoft Teams Premium features rolling into standard plans
In short, you're getting more product — but paying more for it.
What this means for a typical Perth small business
Let's put real numbers on it. A typical Perth small business with 10 staff on Business Standard might see their monthly bill increase from approximately $200/month to $225-230/month.
That's an extra $300-360 per year. Not catastrophic, but worth planning for.
For larger organisations (50+ staff), the impact scales. A 50-person team on E3 licences could see an additional $3,000-5,000 per year.
What you should do now
1. Audit your current licences
Before July, review what you're actually paying for. Most Perth businesses we work with are over-licensed — paying for features nobody uses or for staff who left months ago.
Common waste we find:
- Staff with Premium licences who only need Basic — If someone only uses email and Teams, they don't need Standard or Premium
- Unused licences — Former employees, contractors, or test accounts still active
- Duplicate tools — Paying for Zoom AND Teams, or Dropbox AND OneDrive
A simple licence audit can save more than the price increase costs you.
2. Consider plan changes
The July changes make it worth reassessing whether everyone needs the same plan. A mixed-licence approach often makes sense:
- Frontline workers → Business Basic (email, Teams, basic cloud storage)
- Office workers → Business Standard (full Office apps, SharePoint)
- Managers and finance → Business Premium (security, compliance, Copilot capability)
3. Lock in current pricing
If you're on a month-to-month plan, you might be able to switch to an annual commitment at current pricing before July. This locks in the lower rate for 12 months.
Talk to your Microsoft partner or reseller about this — the window is closing.
4. Use what you're paying for
Most businesses use about 20% of what Microsoft 365 can do. Before paying more, make sure you're getting value from what you already have:
- SharePoint for file storage and collaboration (stop emailing attachments)
- Teams for meetings, chat, and project channels
- Power Automate for workflow automation (included in most plans)
- Forms for internal surveys and client intake
- Planner/To Do for task management
If you're not using these, you're leaving money on the table.
Our recommendation for Perth businesses
Don't panic, but don't ignore it either. The July pricing change is a good excuse to do something you should probably be doing anyway: run an M365 licence audit and make sure you're on the right plans.
We do these audits for Perth businesses all the time. It takes a couple of hours, and most clients save more from eliminating waste than the price increase adds.
Book a free M365 licence review →
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