Microsoft is increasing the prices of its on-premises server products significantly starting this month. Customers who rely on local infrastructure should prepare for noticeable price hikes on several key services.
Products such as SharePoint Server, Exchange Server, and Skype for Business Server will see a 10% price increase beginning in July. In addition, Microsoft’s Core CAL Suite will rise by 15%, while the Enterprise CAL Suite will have a 20% increase.
It’s important to note that these changes only apply to standalone on-premises products; Microsoft’s cloud services like SharePoint Online and Exchange Online will not be affected. Microsoft had previously announced these price changes, which are now officially in effect.
With the pricing adjustments, Microsoft is also promoting its newly updated subscription-based server models, including the Exchange Server Subscription Edition and the Skype for Business Subscription Edition. These editions are part of Microsoft’s Modern Lifecycle Policy, allowing customers to receive continuous updates instead of major version upgrades every few years. To utilize the new editions, active Software Assurance or a cloud subscription license covering all users and devices is required.
In a recent blog post, Microsoft attributed the price increases to the ongoing costs associated with supporting on-premises software. Additionally, they mentioned a decline in revenue, as indicated by a 3% dip in on-premises server revenue reported during their Q2 2025 earnings call. The price hikes could help counterbalance this revenue loss while also encouraging businesses to transition to cloud solutions.
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