· Software
Microsoft Just Raised Its Prices by Up to 33 Percent. That Is the Deal You Signed.
The question is not whether your SaaS vendor will raise prices. It is whether you can afford to say no when they do.
Microsoft told customers plainly why Microsoft 365 commercial prices are going up again on July 1, 2026: it added features, so the price has to catch up. Business Basic rises from $6 to $7 a user a month, up 16.7 percent. Business Standard goes from $12.50 to $14, up 12 percent. The frontline plans take the biggest hit: F1 climbs from $2.25 to $3 a month, up 33 percent, and F3 from $8 to $10, up 25 percent. TechInformed and AdminDroid both trace the increase to a Microsoft announcement framed around "more than 1,100 features added," including the AI, security, and device management tools now bundled into the suite whether you use them or not.
That is the part worth sitting with. You do not get to decline the AI features and keep last year's price. You get the whole bundle at the new number, or you migrate mailboxes and files for every employee somewhere else before your renewal date. Most businesses will pay.
My position: Microsoft's increase is not an outlier. It is what renting software looks like once leaving is expensive, and the right response is not to hope vendors show restraint. It is to decide, tool by tool, whether you are renting or ought to own.
The case for renting, stated fairly
SaaS wins when the product is genuinely hard to build and is improving faster than you could alone: email, identity, cloud storage, the ground Microsoft and Google compete hardest on. You are paying so a team bigger than yours keeps shipping and patching holes you would not catch yourself. For a five-person company, paying $7 a seat for Business Basic instead of running a mail server is not a close call. The math favors renting by a wide margin, and nobody should rebuild Exchange out of spite over a dollar increase.
The trade gets worse the longer you stay
The honest data says this deal is getting worse, not better, the longer you are locked in. Zylo, which tracks more than $75 billion in software spend across its enterprise customers, reports in its 2026 SaaS Management Index that 79 percent of IT leaders hit a price increase at their last renewal, and 78 percent were billed for something new tied to consumption or AI features that was not on last year's invoice. That is not a poll of unhappy customers venting online. It is Zylo watching actual renewal contracts move. The pattern is not "some vendors raise prices." It is "expect it at nearly every renewal, and expect a line item you did not ask for."
Run the real math before you shrug this off. A 20-person team on Business Standard pays $250 a month today, $3,000 a year. At $14 a seat it is $280 a month, $3,360 a year. The extra $360 is not the number that should worry you. A roughly 12 percent increase compounding every year or two, across a stack of a dozen tools that each move on their own renewal schedule, is the number that should.
Where build-versus-buy actually turns on this
This is where the build-or-own question gets real, and it is not all-or-nothing. Keep renting the tools where vendors are genuinely interchangeable and competition keeps them honest: email, video calls, payroll. Those markets are contested enough that a bad price move costs the vendor customers, which is the market doing its job without anyone needing to write a rule about it. Start asking harder questions about the tool where you use a tenth of the features, where your workflow is specific enough that you keep bending your business to fit someone else's product, and where switching would mean months of migration pain. That combination is what turns a subscription into a toll booth, because the vendor knows leaving costs you more than paying does.
That is the actual test, laid out in more detail on MojoSoftware's build-versus-buy page: not whether a tool is annoying, but whether the switching cost it has built up is doing the vendor's pricing work for it. If you want a straight read on which line items in your own stack fit that pattern, that is worth a conversation before your next renewal notice lands.
Sources
References used in this article. Links also appear alongside the relevant claims.
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