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How Much Does Microsoft 365 Cost After the Price Increases? | Blog

In recent years, digital workplace software has become increasingly popular among businesses. Microsoft 365 is one of the most widely used software suites in this category, providing companies with a range of tools for email, collaboration, and document management. However, Microsoft recently announced a price increase for Microsoft 365, which could significantly impact businesses’ budgets.

Fortunately, there are alternatives available that can help reduce costs without sacrificing functionality. One such solution is Zextras Carbonio. In this article, we’ll take a closer look at the Microsoft 365 price increase and how Zextras Carbonio can help businesses reduce their total cost of ownership (TCO) while still enjoying the benefits of a digital workplace.

Microsoft Office 365 Price Increase

Explanation of the Recent Price Increase

On March 1, 2022, Microsoft announced that it would be increasing the prices of several Microsoft 365 plans, including Microsoft 365 Business Basic, Microsoft 365 Business Premium, and Office 365 E1, E3, and E5. The price hike ranges from 8% up to a whopping 25%, depending on the plan.

This marks the first substantive pricing update since the launch of Microsoft 365 nearly a decade ago.

Impact of the Price Increase on Businesses

For businesses that rely on Microsoft 365, the price increase could have a significant impact on their budgets. Many companies have already been hit hard by the COVID-19 pandemic and economic downturn, making any increase in expenses challenging to manage. The Microsoft 365 price hike could force businesses to reevaluate their software solutions or cut back on other essential expenses to make up for the added costs.

Comparison of the New Prices to Competitors’ Offerings

With the price increase, Microsoft 365’s plans are now more expensive than some of its competitors’ offerings. For example, Google Workspace’s Business Starter and Business Standard plans are still more affordable than Microsoft’s corresponding plans, even after their own price increase.

We observe significant price changes in cloud provider solutions, which can be speculated to be related to the complexity of new privacy regulations such as the General Data Protection Regulation (GDPR). Read more on this subject on GDPR Compliance by Design Through Digital Sovereignty: Where Hyperscale Cloud Providers Fall Short.

While private solutions such as Zextras Carbonio, which allows you to deploy your own infrastructure on your premises or private clouds, are already compliant with regulatory requirements, therefore they are unaffected by such regulations.

This price difference could prompt some businesses to consider switching to a different software suite or exploring alternative solutions that offer similar functionality at a lower cost.

Total Cost of Ownership (TCO)

What Is TCO?

Total Cost of Ownership (TCO) is the overall cost of owning and operating a software or technology solution. It includes not only the upfront costs of purchasing the solution but also ongoing expenses such as licensing, maintenance, upgrades, and support.

Calculation of TCO for Microsoft Office 365 Before and After the Price Increase

Before the price increase, the TCO for Microsoft Office 365 was already a concern for many businesses. With the new price hike, the TCO will be even higher.

For example, the price of Microsoft 365 Business Basic has increased from $5 to $6 per user, therefore a small to medium business with one hundred employees using Microsoft 365 Business Basic will now pay $600 per month instead of $500 per month, resulting in an annual cost increase of $100×12 = $1200.

The TCO for larger organizations using more advanced plans like Office 365 E1 will increase even more. For example, the price of Office 365 E1 increased from $8 to $10 per user. A company with a thousand employees will now pay $10000 per month instead of $8000 per month, resulting in a cost increase of $2000×12 = $24000 per year.

Comparison of TCO for Microsoft Office 365 to Zextras Carbonio

Compared to Microsoft Office 365, Zextras Carbonio offers a more cost-effective solution for businesses. Zextras Carbonio offers all the essential features of Microsoft 365, including email, calendaring, collaboration, video meetings, document management, and mobile access, at a lower price point. Additionally, Zextras Carbonio offers flexible licensing options, allowing businesses to pay only for the features they need. This reduces unnecessary expenses, making Zextras Carbonio a more affordable option for businesses of all sizes. When comparing TCO for Microsoft 365 and Zextras Carbonio, the latter comes out on top with significant cost savings for businesses.

Moreover, Zextras Carbonio offers a powerful storage management system that helps organizations to reduce their Total Cost of Ownership (TCO). In the following section, we will delve deeper into this system and discuss its features in detail.

Zextras Carbonio and TCO Reduction

As we said before, Zextras Carbonio offers a powerful storage management system equipped with advanced features such as hierarchical storage management (HSM), deduplication, compression, and support for object storage. This alone makes a huge difference when calculating Zextras Carbonio’s TCO.

Explanation of How Zextras Carbonio helps Reduce TCO

For example, with Zextras Carbonio you can migrate your data to two local storage with different access times in order to implement an HSM strategy. In addition to that you will have the benefits of deduplication and compression. Each of these features saves you some expenses. Let’s try to estimate how much you will save each year with different numbers of mailboxes:

You can read more about these calculations and exact scenarios on how Zextras Carbonio storage system helps you reduce your costs.

As you see not only Zextras Carbonio is a more affordable option for businesses of all sizes but it also helps organizations save on storage costs and even reduce the TCO.

Are You a Business Owner Concerned about the Rising Cost of Microsoft 365?

The recent price increase for Microsoft Office 365 plans has left many businesses concerned about the impact on their budgets. The total cost of ownership for Microsoft’s software suite is already a concern for some companies, and the price hike will only exacerbate this issue. Fortunately, Zextras Carbonio provides a cost-effective alternative that can help businesses reduce their expenses without sacrificing functionality. This way businesses can enjoy all the essential features of Office 365 at a lower price point, with flexible licensing options that let them pay only for the features they need.

With its competitive pricing, flexible licensing options, and all the essential features you need for a digital workplace, Zextras Carbonio can help you reduce your total cost of ownership while still enjoying the benefits of a full-fledged digital workplace.

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