Why are Microsoft 365 prices rising from July 2026?
Microsoft has announced that it will raise the worldwide prices for Microsoft 365 subscriptions from 1 July 2026. The reasoning: new AI features, expanded security capabilities and additional endpoint management tools that are being built into the standard plans. Existing customers who sign their contracts before the cut-off date lock in the previous terms for the duration of the contract.
What sounds like a classic software upgrade is, for many users, a reason to reassess. The question is not whether the new features make technical sense – AI-assisted text suggestions in Word and advanced threat protection in Exchange certainly have their value. The question is whether you actually use these features and whether the higher price is justified relative to your day-to-day work.
From our customer conversations at KARINEX, we know a recurring pattern: many freelancers and small teams pay for Microsoft 365 but use almost exclusively Word, Excel, Outlook and PowerPoint. The cloud synchronisation via OneDrive is appreciated, while most of the advanced features go unused. This is exactly where a comparison with perpetual licences pays off.
For whom is Microsoft 365 worth it despite the price increase?
Microsoft 365 is not a bad choice – but it is not a one-size-fits-all answer either. There are usage profiles for which the subscription model remains the most economically and technically sensible solution.
If you regularly work with changing team members, use several devices in parallel or rely on automatic feature updates, Microsoft 365 remains unbeatable. The licence covers up to five installations per user, cross-platform on Windows, macOS, iOS and Android. Anyone who works at the desktop today, presents on a tablet tomorrow and follows up on a laptop in the evening benefits from the seamless synchronisation.
The cloud connection is not just marketing either. Teams that edit documents together, want to avoid version conflicts or rely on real-time collaboration will find a mature infrastructure in Microsoft 365. The integration of Microsoft Teams, SharePoint and Exchange Online makes the difference when workflows are heavily interconnected.
A third argument: security and compliance. Microsoft delivers monthly security updates and closes vulnerabilities promptly – an aspect that has gained weight particularly after the recent vulnerability reports (167 flaws in April 2026 alone). Anyone who works in regulated industries or processes sensitive customer data can hardly do without this update cadence.
When does switching to Office 2024 or 2021 pay off?
The calculation is simple, but it is rarely worked through consistently. Microsoft 365 Personal currently costs around 69 euros per year. Over five years that adds up to 345 euros – without factoring in the announced price increase. A perpetual licence such as Office 2021 Home & Business comes in at a one-time cost of under 10 euros, and Office 2024 Standard likewise. Even if you upgrade to a new version after six years, you remain well below the subscription model in terms of cost.
The catch: you receive no new features. Office 2021 stays at the 2021 level, Office 2024 at the 2024 level. Microsoft delivers security updates for five years (mainstream support), followed by another two years of extended support. For users who use Word, Excel and PowerPoint at their core – writing texts, performing calculations, creating presentations – little changes. The features are mature, stable and proven over years.
A typical case from everyday support at KARINEX: a tax advisor with three employees was using Microsoft 365 Business Basic, primarily for Outlook and Excel. After switching to Office 2021 Home & Business (which includes Outlook) and a local Exchange alternative, the annual software licence bill fell by almost 80 percent. The way of working did not change; the costs did.
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Get it now →Office 2024 Standard vs. Office 2021 Home & Business – which perpetual licence fits?
Both versions are perpetual licences without a subscription commitment, but they differ in scope. Office 2024 Standard for Windows includes Word, Excel, PowerPoint and Outlook. That is entirely sufficient for classic office work. Office 2021 Home & Business offers the same range of functions but is based on the older 2021 code base. The price difference is just a few euros.
Office 2024 Standard has one decisive advantage: you get the updated versions of the core applications with improvements in usability, performance and file formats. Anyone who regularly edits larger Excel files or creates complex PowerPoint presentations with animations benefits from the optimisations. The leaner code is especially noticeable on hardware with limited memory.
Office 2021 Home & Business is interesting for users who prioritise maximum stability and deliberately forgo the newest features. The software has been in use for three years, most teething problems have been resolved, and driver issues are rare. Anyone working on an older operating system or who does not want to upgrade every few years will find a reliable foundation here.
For macOS users there is a particularity: Office 2024 Home and Business for Mac also includes Word, Excel, PowerPoint and Outlook – Publisher and Access are not available for macOS, as they were never ported. The range of functions is identical to the Windows variant, apart from platform-specific adjustments.
What happens to existing Microsoft 365 contracts after the price increase?
Microsoft grants existing customers a grace period. Anyone who signs or renews their contract before 1 July 2026 continues to pay the previous price for the booked term. This also applies to automatic renewals, provided they are active before the cut-off date. Once the contract term expires, the new prices take effect.
In concrete terms: a one-year contract signed in June 2026 runs at the old price until June 2027. From the renewal in June 2027, the new tariff applies. Monthly subscriptions without a minimum term become more expensive immediately from July 2026. So anyone planning to continue using Microsoft 365 can secure the previous terms for twelve months through a timely renewal.
For companies with several licences, it is worth examining volume licensing models, which depending on the number of users and the term can work out cheaper than individual licences. However, the fundamental question remains here too: is the full range of functions actually being used?
Do freelancers really need a Microsoft 365 subscription?
The honest answer: usually not. Freelancers rarely work in large teams; real-time collaboration is the exception rather than the rule. Cloud synchronisation can also be handled via individual OneDrive accounts (free with 5 GB or with a paid upgrade) or alternative services such as Nextcloud. The monthly feature updates from Microsoft 365 often concern functions that play no role in everyday agency, tax-advisory or engineering-office work.
What freelancers need: a reliable office suite with Word, Excel, PowerPoint and, above all, Outlook. That is exactly what Office 2024 Standard and Office 2021 Home & Business deliver. Both include Outlook – a common misconception is that perpetual licences have to do without an email client. That only applies to Office Home & Student (without Outlook), but not to the Business variants.
A practical example: a freelance graphic designer was using Microsoft 365 Personal, mainly for PowerPoint presentations and the occasional Excel analysis. The Creative Cloud connection (not part of Microsoft 365) turned out to be a misunderstanding, and she did not use the OneDrive integration since she worked on external servers anyway. After switching to Office 2024 Standard, the functionality remained identical and the annual costs disappeared.
Which version fits you?
If you work with several devices every day, regularly collaborate as a team or rely on automatic updates, Microsoft 365 remains the most economical solution even after the price increase. Lock in the old terms with a contract renewal before 1 July 2026.
If you work mostly on your own, use the core Office applications without advanced cloud features and do not plan to need new functions every twelve months, then Office 2024 Standard or Office 2021 Home & Business pays off. The one-time cost amortises within the first year, and the software remains permanently activatable.
