Microsoft Raises Prices on Core Enterprise On-Premises Offerings

Posted on July 27, 2018 by Paul Thurrott in Microsoft, Office, Windows 10 with 12 Comments

Microsoft this week quietly revealed that it will “adjust”—e.g. “raise”—the price of some of its core enterprise on-premises products.

“Microsoft will be making a series of changes across our program and product portfolio to provide unique offers that support customer digital transformation, improve the buying and selling experience, and make it easier to do business with Microsoft,” an announcement to the Microsoft Partner Network blog reveals. “On October 1, 2018, we will adjust pricing for our licensing programs and make price adjustments to on-premises and cloud products.”

While Microsoft says that pricing will go for both cloud and on-premises products, it appears that only the latter is being impacted directly.

More specifically, Microsoft notes that it is raising the price on both Windows 10 Enterprise and the Office 2019 commercial suites. The Office pricing is easier to understand, so let’s get that out of the way first: Office 2019 will cost 10 percent more to license than its predecessors.

Windows 10 Enterprise, alas, is more complex.

Today, Microsoft offers enterprises three “versions” of this product via volume licensing: Windows 10 Enterprise and Windows 10 Enterprise E3, which it considers its “core” offerings, and Windows 10 Enterprise E5, which throws Windows Defender Advanced Threat Protection (Windows Defender ATP) into the mix.

This week’s announcement concerns only the first two “core” offerings. And as of October 2018, the price of Windows 10 Enterprise will be raised to match the $7 per seat per month pricing of Windows 10 Enterprise E3. (A “seat” can be a user or a PC.)

What we don’t get from the Microsoft revelation is “why.” But the natural assumption is that Microsoft is trying to push the remaining on-premises holdouts to the cloud.

And Mary Jo Foley has found some proof of this. “By updating discounting policies meant to sell software at scale,” she writes,” Microsoft officials said they will no longer be ‘incentivizing (customers) to standardize unnecessarily on software’.”

 

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