Microsoft 365 Pricing 2026: All Plans, History & What Changed

Microsoft raised Microsoft 365 prices by 20% in March 2022 — the first price increase in over a decade. Here's every plan, every price change, and what to watch for next.

+20%

Business plan increase (2022)

$6–$57

Per user/month range

11 yrs

No price changes (2011–2022)

2022

Year of first major hike

Current Microsoft 365 Plans (2026)

Personal & Family Plans

Plan	Price	Users	Key features
Microsoft 365 Personal	$6.99/mo $69.99/yr	1 user	Word, Excel, PowerPoint, Outlook, 1TB OneDrive, 60 Skype minutes/month
Microsoft 365 Family	$9.99/mo $99.99/yr	Up to 6 users	All Personal features × 6, 1TB OneDrive per person (6TB total), Family Safety app

Business Plans

Plan	Price	Best for	Key features
Microsoft 365 Apps for Business	$8.25/user/mo	Teams needing desktop apps only	Desktop Office apps, 1TB OneDrive, mobile apps. No Teams, no Exchange
Microsoft 365 Business Basic	$6/user/mo	Cloud-first small teams	Web/mobile Office, Teams, Exchange (50GB), SharePoint, 1TB OneDrive. No desktop apps
Microsoft 365 Business Standard	$12.50/user/mo	Most businesses	Everything in Basic + desktop Office apps, Teams webinars, video editing (Clipchamp)
Microsoft 365 Business Premium	$22/user/mo	Security-conscious SMBs	Everything in Standard + Intune, Azure AD Premium, Advanced Threat Protection, Defender

All business plans billed annually. Month-to-month pricing runs 20-30% higher. Max 300 users.

Enterprise Plans (Microsoft 365 E-series)

Plan	Price	Key additions
Microsoft 365 E3	$36/user/mo	Unlimited cloud archiving, eDiscovery, advanced compliance, no user cap
Microsoft 365 E5	$57/user/mo	Everything in E3 + Power BI Pro, Teams Phone, Advanced Threat Intelligence, SIEM
Microsoft 365 F1	$2.25/user/mo	Frontline workers: Teams, SharePoint, web Office only. No email, no desktop apps
Microsoft 365 F3	$8/user/mo	Frontline workers with more features: desktop apps, Exchange, Power Apps

Copilot Add-On: The Big New Cost

In 2024, Microsoft launched Microsoft 365 Copilot — their AI assistant — as a mandatory add-on at $30/user/month. This is significant:

A 100-person team on Business Standard ($12.50/user) adding Copilot pays an additional $36,000/year
Copilot requires E3 or E5 for enterprise customers — you can't add it to Basic
Early enterprise rollouts showed mixed adoption (many employees didn't use it regularly)
Microsoft reduced the minimum seat requirement from 300 → 1 seat in January 2024 to drive SMB adoption

Copilot pricing: $30/user/month (minimum 1 seat as of Jan 2024). Requires Microsoft 365 Business Standard or higher.

Microsoft 365 Price History

Microsoft was remarkably stable on pricing for over a decade — then changed everything in 2022.

Mar 2022

+20% Business Plans

First price increase since 2011 — all commercial plans up 20%

Business Basic: $5 → $6/user/month (+20%)
Business Standard: $12.50 → $15/user/month — wait, Standard actually stayed at $12.50
Apps for Business: $8.25 (new SKU replacing old Office 365 Business)
Business Premium: $20 → $22/user/month (+10%)
E3: $32 → $36/user/month (+12.5%)
E5: $57/user/month (unchanged, was already high)

Jan 2024

AI Add-on Launch

Copilot for Microsoft 365 goes GA, min seat requirement drops to 1

Microsoft 365 Copilot launches at $30/user/month. Initially required 300 seats (enterprise only), then dropped to 1 seat minimum in January 2024 to open SMB market. Net effect: Microsoft nearly doubled their revenue per enterprise user if Copilot adoption takes hold.

Apr 2023

Feature Bundle Change

Teams unbundled in Europe following EU antitrust ruling

Under EU pressure, Microsoft began offering Microsoft 365 without Teams in Europe, reducing prices slightly for EU customers who wanted the full suite. This didn't affect US/global pricing.

2011–2021

10 Years Stable

No price increases for an entire decade

From Office 365's launch in 2011 through 2021, Microsoft did not raise commercial prices. This made the 2022 hike more jarring — it hit organizations that had budgeted for stable costs for years.

Microsoft 365 vs Google Workspace: Cost Comparison

Use case	Microsoft 365	Google Workspace	Verdict
Small team (5 users), cloud-only	$30/mo (Basic)	$36/mo (Business Starter)	M365 cheaper by $6/mo
Mid-size team (20 users)	$250/mo (Standard)	$240/mo (Business Standard)	Near-parity
Need desktop apps	$12.50/user/mo (Standard)	N/A (web only)	M365 only option
Enterprise (100 users)	$3,600/mo (E3)	$2,200/mo (Business Plus)	Workspace 39% cheaper
With AI (Copilot / Gemini)	+$30/user/mo Copilot	+$10/user/mo Gemini	Workspace 3× cheaper for AI

See our full Microsoft 365 vs Google Workspace comparison for a complete breakdown.

Is Microsoft 365 Worth the Price?

When Microsoft 365 is the clear choice

You need desktop apps: Excel on desktop is still far more capable than Google Sheets for financial modeling, pivot tables, and complex macros. No real alternative.
You're already in the Microsoft ecosystem: Active Directory, Azure, Intune, SharePoint — switching has high hidden costs.
Regulated industries: Healthcare, legal, and government often require M365 compliance features (eDiscovery, archiving, DLP) that Workspace can't match at the same tier.
Windows-heavy org: M365 manages Windows devices natively via Intune in Business Premium.

When to consider switching

Cloud-first teams: If your team lives in browser tabs and doesn't need desktop Office, Google Workspace is cheaper and simpler.
Startups: Google Workspace's startup program offers free usage up to a year. M365 has no equivalent.
You're adding Copilot: At $30/user vs $10/user for Google's Gemini, the cost gap is real. Gemini is deeply integrated — no add-on required.
Mac/Linux teams: M365 is better on Windows. Workspace runs equally well on every platform.

Microsoft 365 Pricing: What to Watch Next

Based on Microsoft's pattern, these are the most likely pricing moves in 2026–2027:

Copilot bundling: Microsoft will likely bundle Copilot into higher-tier plans rather than keeping it as an optional add-on — forcing enterprises to pay for AI whether they use it or not.
F-series price increase: Frontline plans (F1 at $2.25) are underpriced relative to Business plans. A normalization push is likely.
E3/E5 consolidation: Microsoft may restructure enterprise tiers to push E5 adoption (higher margin), making E3 less attractive by moving features up.
Teams unbundling globally: Following EU antitrust, there's pressure to extend Teams unbundling globally, which could complicate pricing for IT managers.

PricePulse monitors Microsoft 365 pricing pages 24/7. Get notified the moment prices change.

Frequently Asked Questions

What's the cheapest way to get Microsoft Office?

Microsoft 365 Personal at $69.99/year ($5.83/month) is the cheapest legitimate option. Students can often get Microsoft 365 Education free through their school. Microsoft also runs frequent promotional discounts on annual plans — sometimes 20-30% off for new subscribers.

Is Business Basic worth it if you need desktop apps?

No. Business Basic ($6/user/month) only includes web and mobile versions of Office. If your team needs Excel, Word, or PowerPoint on desktop, you need Business Standard ($12.50/user) or Apps for Business ($8.25/user). The web apps are significantly less capable for heavy use cases.

Does Microsoft 365 include Teams?

Business Basic, Business Standard, and Business Premium all include Teams. Apps for Business does not. In the EU, Teams has been unbundled due to antitrust concerns — European businesses can buy M365 without Teams at a slightly reduced price.

How much does Microsoft 365 Copilot actually cost per year?

$360/user/year ($30/month). For a 50-person company, that's $18,000/year just for Copilot on top of existing M365 costs. Google's Gemini is integrated in Workspace at no additional cost in most plans, or $10/user/month for the advanced version.

Can you still buy a one-time Office license instead?

Yes. Microsoft still sells Office Home & Student 2024 as a one-time purchase for ~$149.99 (1 PC or Mac). It includes Word, Excel, and PowerPoint — but no Outlook, no OneDrive, no Teams, no updates. For businesses that just need the core apps without cloud services, it's worth considering.

Will Microsoft raise prices again?

Likely yes — the 2022 increase was framed as a one-time correction after 11 years of flat pricing, but the launch of Copilot as a $30/user add-on is effectively a second price increase. We monitor Microsoft 365 pricing pages daily. Sign up free to get notified the moment anything changes.

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