Microsoft 365 Gets More Expensive in 2026: What Changes and How SMEs Can Still Save

In December 2025, Microsoft announced a price and packaging update: from 1 July 2026, higher list prices apply for Microsoft 365 – and with Copilot Chat, a baseline AI feature arrives in practically every plan at the same time. For most of the SMEs we support across the Berchtesgaden and Traunstein regions, this first sounds like a straightforward price hike. In practice it is something else: a good reason to clean up a licensing landscape that has grown over the years and almost never matches actual usage.

We see the same pattern in nearly every review: a business once bought a single licence for everyone – usually the most expensive one, "so everyone can do everything" – and never touched it again. This is exactly where the savings sit, and they can more than offset the price increase.

The new prices from 1 July 2026

The new list prices apply to new contracts and renewals from 1 July 2026. Existing contracts continue on their terms until they renew for the first time after that date. The key changes to the Business plans (per user, per month):

• Business Basic: €6.00 → €7.00 (+16.7%)
• Business Standard: €12.50 → €14.00 (+12%)
• Business Premium: €22.00 → €22.00 (unchanged)

The fact that Business Premium of all plans stays stable is notable – and shifts the maths noticeably in some cases. For mid-market customers, the Enterprise plans are also relevant:

• Office 365 E1: €10.00 → €10.00 (unchanged)
• Microsoft 365 E3: €36.00 → €39.00 (+8.3%)
• Microsoft 365 E5: €57.00 → €60.00 (+5.3%)

Copilot Chat vs Copilot for Microsoft 365 – the distinction that matters

Few topics cause as much confusion right now as Copilot. The reason: there are two very different products with similar names.

• Copilot Chat is included in the plans from 1 July 2026. It is a baseline AI chat that works primarily with web content and only uses the data you put into the prompt yourself. It is part of the plan and cannot be "opted out" as a separate add-on.
• Copilot for Microsoft 365 is the full Copilot, deeply integrated into Word, Excel, PowerPoint, Outlook and Teams and – depending on the setup – with access to your work data. It remains a separate, paid add-on (around €30 per user per month) and can be licensed selectively for individual users.

Anyone who confuses the two either plans too generously (booking the expensive add-on for the whole workforce) or too anxiously (believing that from July they automatically pay €30 more per head). Both are wrong.

Is the full Copilot worth it for an SME?

Our honest assessment from practice: Copilot for Microsoft 365 is strong at email summaries, meeting notes, first drafts and data analysis in Excel. It is weaker at complex specialist tasks, highly domain-specific content and occasionally still at the German language. Realistically, expect 30 to 60 minutes of time saved per user per week with active use – and a ramp-up period of two to four weeks before it lands productively.

Our recommendation: start with three to five power users before rolling the full Copilot out across the board. That way you gather solid experience and can judge the return on investment rather than guess it. Anyone planning a clean rollout should treat it as part of a broader IT consulting and digitalisation strategy – including the question of which data Copilot is allowed to see and which permissions need tidying up first.

Which plan do you actually need?

The most expensive licence is rarely the right one for everyone. A rough guide:

• Business Basic (€7): for staff who only use email, Teams and web apps – no desktop Office. Typical for field engineers, warehouse and mobile sales staff.
• Business Standard (€14): the sweet spot for most office workstations. Desktop apps, full functionality.
• Business Premium (€22): where heightened security requirements exist – with Intune for device management, Conditional Access and advanced threat protection. Sensible for IT leads, management and anywhere sensitive data is involved.

In practice, Standard covers roughly 80 per cent of users, while Premium is deployed precisely where the security features are genuinely needed. That security angle – who may access what, which devices are managed – is also a core topic of our IT security consulting.

A worked example from the trades

A trades business with 25 employees had booked Business Premium for everyone – €550 per month. After analysing actual usage, the mix looked like this: five office staff on Business Standard, fifteen field engineers on Business Basic (email and Teams on the phone is enough), five apprentices on Microsoft 365 Apps for Business. New cost: €285 per month – 48 per cent less with full functionality for the real requirements.

It was similar for a tax consultancy with twelve employees in Bad Reichenhall, which had everyone on Premium (€3,168 per year) even though many only used email and DATEV. After switching to a targeted mix – Premium for partners and IT leads, Standard for case handlers, Basic for apprentices – the cost came to €1,896 per year. Savings: €1,272 annually, with no compromise on security for sensitive client data.

Five levers to save despite the price increase

1. Run a licence audit. Who really needs which features? This is the foundation for everything else – and usually the point with the biggest effect.
2. Annual instead of monthly licences. Paying annually can save up to 20 per cent.
3. A licence mix instead of one-size-fits-all. Differentiate by role rather than giving everyone the top tier.
4. Cancel inactive licences. Former staff, unused shared mailboxes, forgotten test accounts – it all adds up.
5. Buy through a CSP partner. Through partners the licences are often 5 to 10 per cent cheaper than directly from Microsoft – plus consulting and support from a single source.

Watch out for legacy contracts

If your contract was signed before 2022, it is worth reviewing the options now. Open License is being retired – a move to CSP or NCE is required here. Enterprise Agreements are simply oversized for many SMEs. The New Commerce Experience (NCE) is the current standard licensing with more flexible options. Especially around the July 2026 deadline, it makes sense to time renewals deliberately rather than letting them run automatically.

What we recommend

The price increase is no reason to panic, but a good reason for a stocktake. Anyone who reviews their licence mix before 1 July 2026 can, in most cases, fully absorb the higher list prices – and gets Copilot Chat as an extra feature at no surcharge along the way. For businesses across the Berchtesgaden and Traunstein regions, we are happy to look at the current licensing and show concretely where the savings sit. In our experience that tends to be between 15 and 40 per cent – money that is often better invested in your own IT infrastructure than in unused Premium features.

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