Pricing
Microsoft 365 Standard is now $14. Premium didn't move.
The July 1 increase adds $18 per seat per year on Business Standard and folds Copilot Chat into the base plan, with no described way to decline it.
Microsoft's commercial price update for Microsoft 365 took effect on July 1. It was announced on December 4, 2025, so the increase itself is not news. What it does to your options is.
Business Basic goes from $6.00 to $7.00 per user per month. Business Standard goes from $12.50 to $14.00. Business Premium does not move — it stays at $22.00. The versions sold without Teams rise harder: Basic without Teams goes $4.40 to $5.40, which Microsoft lists as 23%. On the enterprise side, Office 365 E3 goes $23 to $26, Microsoft 365 E3 $36 to $39, and E5 $57 to $60.
Do the arithmetic, not the percentage
Business Standard costs $18 more per seat per year. A five-person team pays $90 more; ten people, $180. Real, but survivable. The percentage reads worse than the invoice does.
What you get for it is not nothing: 50GB more mailbox storage, URL time-of-click protection on malicious links, and Copilot Chat in the base packaging — with inbox and calendar awareness and access to Word, Excel and PowerPoint agents. Microsoft's licensing pages describe no mechanism to refuse the additions and hold the old price. You are buying AI now whether it was on your list or not. The standalone Copilot add-on and standalone Teams are excluded from this update.
The thing actually worth doing
Premium held flat while Standard climbed, so the gap between them narrowed from $9.50 to $8.00 per user per month. Premium buys Intune, Defender and conditional access. If you priced that upgrade in December and passed on it, the maths moved underneath you. For ten people the step up is now $960 a year rather than $1,140. Re-run it.
Second: look up your renewal date. Existing customers stay on old pricing until renewal and still receive the new features in the meantime. Microsoft says it gives 30 days' notice in Message Center before packaging changes reach your tenant.
For context, Google Workspace Business Standard also lists at $14 per user per month on annual billing, with Gemini bundled rather than sold separately. Both vendors made the same move: put the model in the base plan, then raise the base plan.
Why it matters
Microsoft 365 is likely your largest per-seat line item, and the increase is now unavoidable at renewal — Business Standard costs $18 more per seat per year. The narrowed gap to Business Premium ($8/user/month instead of $9.50) makes the Intune and Defender upgrade cheaper in relative terms than it was in December, so a 10-person team should re-run that comparison before renewing.
Sources
- Microsoft 365 Pricing and Packaging Updates — Microsoft (primary)
- Microsoft 365 Packaging and Pricing Updates Public FAQ — Microsoft (primary)
- Advancing Microsoft 365: New capabilities and pricing update — Microsoft 365 Blog (primary)
- Microsoft 365 just got a price hike over continuous innovation, but Copilot is the AI tax on businesses — Windows Latest
- Microsoft 365 Business Price Increase: Who Pays More in 2026 — Office Watch
- Compare Flexible Pricing Plan Options — Google Workspace (primary)
Reported by Software Crit from the sources above. Every story is confirmed against at least two independent publishers before publication.
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