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October 24, 2016

Pound plunge and Brexit forces Microsoft price hike

Enterprise software and cloud prices to be raised by up to 22%.

By Ellie Burns

Microsoft is going to hike the price of its software and cloud services in the UK in order to have parity with prices in EU/EFTA region following the fall in pound.

From January 2017, British enterprise customers will have to shell out up to 22% morea as the company looks to realign prices with Euro levels. Customers can expect a 13% increase for enterprise software products and 22% for cloud services.

It says that the move is very similar to the increase in prices in Norwegian Krone and Swiss Franc which were increased early this year.

Microsoft has, however, said that customers will still find the prices competitive when compared to others. The price of software bought from vendors through indirect sales will be decided by them.

In the EU/EFTA region, Microsoft’s partners will continue to have access to prevailing prices in Euro, Norwegian krone, Swiss franc, Swedish krona and Danish krone along with the British Pound.

Microsoft also said that for business customers who have already placed orders under annuity volume licensing are subject to price protection.

Apart from this, business customers with cloud commitment subscriptions such as Office 365 are also subject to price protection during their subscription term.

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Microsoft said: “Prices for new product additions under existing volume licensing agreements and purchases under new contracts will be as defined by the price list at the time of order.

“This pricing change will not apply to consumer software or consumer cloud services.”

Microsoft noted that it had to resort to a price hike due to the fall in value of British Pound Sterling against US Dollar.

The fall in the value is being attributed to the Brexit vote and it has affected not just Microsoft, but many more businesses and organisations across several industries.

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