Microsoft has announced upcoming pricing changes to Microsoft 365 that will take effect from 1 July 2026 for business and government customers. For Australian organisations, this update is more than a routine price rise — it’s a signal to reassess licensing, security posture, and overall value.
Rather than viewing the change purely as a cost increase, businesses should treat it as an opportunity to ensure they are paying for the right tools, configured correctly, and aligned with their risk profile.
Why Is Microsoft 365 Increasing in Price?
Microsoft has stated that the 2026 pricing update reflects increased investment in security, device management, and AI-enabled administration across its Microsoft 365 suites.
According to Microsoft, these enhancements are designed to help organisations:
- Better protect users from phishing and malware
- Improve visibility and control across devices
- Manage increasingly complex IT environments with fewer internal resources
Microsoft Corporate Vice President Nicole Herskowitz noted that these changes are intended to “increase the value of our suites across security, productivity, and management.”
While the exact inclusions vary by licence type, Microsoft has indicated that some capabilities previously sold as add-ons will be incorporated into higher-tier plans over time.
Check your New Microsoft Office 365 Price
The table below outlines current Microsoft 365 list pricing alongside the announced 2026 pricing changes. Microsoft sets pricing globally in USD, with local market adjustments applied for Australia, so final AUD pricing may vary from direct currency conversion. This comparison is provided to illustrate relative changes by licence type rather than exact Australian billing amounts.
Via: Microsoft.com
Pricing Table Disclaimer:
Australian pricing for 2026 has not yet been formally published and is subject to change. Actual costs will depend on Microsoft’s regional pricing, contract terms, and billing arrangements. Businesses should use this information as a planning guide only and confirm final pricing before renewal or budget decisions.
What New Capabilities Is Microsoft Introducing?
Enhanced Email & Threat Protection
Microsoft has indicated that advanced email security capabilities — similar to those found in Microsoft Defender for Office 365 Plan 1 — will be introduced into selected E3 and E5-level licences, helping organisations better defend against:
- Phishing attacks
- Malicious attachments and links
- Email-based malware
Expanded Device & Endpoint Management
Microsoft is also investing heavily in endpoint management through Microsoft Intune, with capabilities such as:
- Intune Remote Help
- Intune Advanced Analytics
- Intune Plan 2 features
These tools are designed to give IT teams improved visibility, faster troubleshooting, and stronger control over managed devices.
Additional Controls for AI & Privileged Access
For organisations using Microsoft 365 E5, Microsoft has announced plans to include tools that help govern AI usage and privileged access, such as:
- Endpoint Privilege Management
- Enterprise Application Management
- Microsoft Cloud PKI
Microsoft has positioned these additions as essential foundations for secure AI adoption in modern workplaces.
How the New Microsoft 365 Prices Affect Australian Businesses
Although Microsoft publishes pricing changes in USD, the increase will be applied globally, with local market adjustments. This means Australian pricing will be influenced by Microsoft’s regional pricing model rather than a simple USD-to-AUD conversion.
For Australian small and mid-sized businesses, this may result in:
- Higher per-user subscription costs
- Increased pressure on fixed IT budgets
- Greater scrutiny of Microsoft 365 licence utilisation
Organisations that rely heavily on Microsoft 365 for productivity, email, and collaboration will likely feel the impact most acutely.
What Australian Businesses Should Do Now
Rather than waiting until mid‑2026, businesses can take proactive steps now to reduce risk and control costs.
Review Existing Licences
Many organisations are unknowingly over-licensed or paying for features they don’t use. A structured licence review can identify:
- Unused or duplicated licences
- Users on higher tiers without a clear business need
- Opportunities to standardise plan
Consider Annual Commitments
Where appropriate, annual Microsoft 365 subscriptions can offer more predictable costs and better value than month-to-month licensing. While this requires upfront planning, it can help smooth budgeting ahead of the increase.
Reassess Security Requirements
Some businesses may already be paying for third-party security tools that overlap with Microsoft’s built-in capabilities. Others may be under-protected and exposed to unnecessary risk. The upcoming changes make this an ideal time to reassess whether your security stack is fit for purpose.
Seek Independent Advice
Working with an experienced Microsoft partner or IT consultant can help ensure:
- Licensing aligns with real business needs
- Security features are correctly configured
- You are not paying more than necessary
For many Australian SMBs, independent advice pays for itself by uncovering inefficiencies and reducing long-term risk.
Are There Alternatives to Microsoft 365?
For some organisations, the price increase may prompt a broader review of productivity platforms. Alternatives such as Google Workspace offer comparable tools for email, documents, and collaboration.
However, migration costs, staff retraining, and security implications should be carefully weighed before making a change. In many cases, optimising an existing Microsoft 365 environment delivers better value than switching platforms.
Frequently Asked Questions (FAQ)
How much will Microsoft 365 increase in price in Australia?
Microsoft has announced global pricing changes effective from 1 July 2026, but Australian pricing has not been finalised. Local prices will reflect Microsoft’s regional pricing model rather than a direct USD-to-AUD conversion. The exact increase will vary by licence type and contract structure.
Does the 2026 Microsoft 365 price increase apply to Australian small businesses?
Yes. The increase applies to business and government customers, including small and mid-sized Australian organisations. Businesses on monthly subscriptions may feel the impact more immediately than those on annual commitments.
Why has Microsoft 365 gone up in price?
Microsoft has stated that the increase reflects continued investment in security, device management, and AI-enabled capabilities across Microsoft 365, including enhancements to email protection, endpoint management, and administrative tools.
Can I avoid or reduce the Microsoft 365 price hike?
While the increase itself cannot be avoided, organisations can reduce its impact by reviewing licences, removing unused subscriptions, switching to annual commitments, and ensuring users are on the most appropriate plans.
Should my business switch away from Microsoft 365?
For most Australian businesses, optimising an existing Microsoft 365 environment delivers better value than migrating to an alternative platform, which may introduce hidden costs, retraining requirements, and security risks.
Final Thoughts
The Microsoft 365 price increase scheduled for 2026 reflects Microsoft’s growing focus on security, management, and AI-driven services. While costs are rising, so too is the complexity — and potential value — of the platform.
Australian businesses that act early, review their licensing, and seek expert guidance will be best positioned to manage the increase without compromising productivity or security.
If you’re unsure how the Microsoft 365 pricing changes will affect your business, a proactive review now can prevent unnecessary cost increases later.
At 1300 INTECH, we help Australian businesses review Microsoft 365 licensing, optimise security, and eliminate wasted spend ahead of upcoming price changes. We take the time to understand how your organisation actually uses Microsoft 365, identify over-licensing or gaps in protection, and ensure the right features are in place before costs rise.
If you want to understand how the 2026 Microsoft 365 price increase will affect your business and what you can do now to minimise its impact, we're here to help. Speak with our team for clear, practical advice and plan with confidence. Book a 15-minute discovery call today!
