Microsoft price increase 2025 as a wake-up call: Time for European data sovereignty

As of 1 April 2025 at the latest, a comprehensive price increase for nearly all Microsoft services has come into effect. This affects both business and private customers and has been gradually implemented since December 2024. These price increases come at a particularly inopportune moment for many companies, given the current inflation and general fears of recession. They represent not only a financial burden but also raise fundamental questions about long-term strategy and dependencies in the area of digital infrastructure.

Affected products and specific increases

Microsoft's price adjustments affect almost their entire cloud portfolio, including Microsoft 365, Office 365 subscriptions, Windows 365, Power BI Pro and Premium-per-User, as well as Teams Phone. Some price increases are particularly dramatic: Teams Phone will be 25% more expensive (from $8 to $10 per user), whilst Power BI Pro will increase by as much as 40% (from $10 to $14). For Windows Server and System Center, increases of 10% have been announced.

The new billing model: Additional costs through monthly payments

In addition to these direct price increases, Microsoft has introduced a new billing model where annual subscriptions with monthly payment will be 5% more expensive than annual advance payments. This seemingly small adjustment means a significant cost increase for companies with numerous licences and aims to encourage customers to pay in advance.

Strategies behind the price adjustment

Microsoft justifies the price increases with the "increased value" of their products through continuous innovation, particularly in the field of artificial intelligence – such as with Copilot – as well as with higher development costs. However, the adjustment of the billing models also serves to steer customers towards annual contracts with advance payment. This improves Microsoft's cash flow and binds customers in the longer term – a classic example of vendor lock-in strategies.

Options for affected companies

Companies affected by the price increases have a special right of termination at the time the changes take effect. However, upon termination, the contract does not end immediately but at the end of the respective contract term. Those who do not exercise their special right of termination automatically accept the new prices.

Those who wish to avoid vendor lock-in and want to strategically realign should take the following measures:

• Analyse licence inventory: Which Microsoft products are actually being used and to what extent? Are there unused or oversized licences?
• Review payment model: Consider switching from monthly to annual payment to avoid the 5% price surcharge, if it's too late to cancel
• Evaluate alternatives: Are there more cost-effective alternatives that offer the needed functions?
• Strategic realignment: Align long-term IT strategy towards independence, data protection and cost control
• Examine hybrid solutions: Does the entire company need to use Microsoft products, or can some areas already be switched to alternatives?

mailbox.org as a data protection-compliant alternative

For companies wishing to become independent from US providers, mailbox.org offers a secure, privacy-friendly alternative. mailbox.org impresses with PGP-encrypted emails, calendar, contacts, task management and browser-based office applications. A decisive advantage lies in the exclusive data storage in Germany, complying with the strictest data protection regulations.

The solution is characterised by a transparent pricing model without hidden costs and offers a balanced relationship between functionality and costs, especially for small and medium-sized enterprises. With its focus on security, data protection and European values, mailbox.org positions itself as a future-proof alternative in the changing digital landscape.

Impact for private users

For private users, mailbox.org also offers an attractive alternative with tariffs starting from €1 per month, as they too are affected by the price increases. Microsoft 365 Family prices will rise from €99 to €129 (+30%) and Personal from €69 to €99 (+43%). It's worth noting that the advertised AI functions such as Copilot are subject to significant limitations and are only available to the main account user.

Digital sovereignty as a future perspective

The current price increases highlight the problem of comprehensive dependence on non-European tech giants. Forward-thinking companies now have the opportunity to reconsider their digital infrastructure and switch to European solutions. This is more than a price issue – it's an investment in digital sovereignty, data security and entrepreneurial independence in an increasingly data-sensitive business world.