Major Microsoft Licensing Changes 2025 – What’s Happening and How to Prepare

As of November 1, 2025, Microsoft has rolled out significant changes to its enterprise licensing model for cloud services. These changes affect organizations worldwide, including those in Finland and the Nordics. Two big updates stand out: the elimination of volume-based discount tiers in Enterprise Agreements, and a new option to choose Microsoft 365 plans with or without Microsoft Teams. Here’s what’s changing and how your organization can navigate these updates with confidence.

• End of Volume Discounts in EA/MPSA: Microsoft is eliminating the volume-based discount tiers (Price Levels A–D) in Enterprise Agreement (EA) and Microsoft Products and Services Agreement (MPSA) contracts for online services. Starting November 1, 2025, at your next contract renewal or new purchase, all customers will pay the same standard list price (formerly Level A) regardless of organization size. Previously, large enterprises received automatic licensing discounts for higher user counts, but those volume discounts will no longer apply.
• Impact on Pricing: This change means larger organizations will see higher licensing costs when their agreements renew, since they lose the prior automatic discounts. Existing contracts retain their current pricing until they expire, and on-premises software and Azure are not affected by these changes.
• Teams Re-bundled into Microsoft 365: After temporarily unbundling Teams in Europe due to regulatory requirements, Microsoft is reintegrating Teams into Microsoft 365/Office 365 suites. Going forward, each M365/O365 plan will be offered in two versions: one with Teams included and one without Teams.
• “With Teams” vs. “Without Teams” Options: Bundled plans that include Teams will continue at the same price as before (no increase for customers who keep Teams in their subscription). The new “without Teams” versions of these plans will be offered at a significantly lower price, allowing organizations that don’t need Teams (e.g. those using alternative collaboration tools) to save on licensing costs. To maintain a clear cost difference, the standalone Teams license (for those adding Teams separately) will be priced higher than it was previously.
• Special Flexibility for EU Customers: For customers in the EU/EEA region, Microsoft is providing an added flexibility: over the next five years, organizations on multi-year contracts (like EA) are allowed to switch from a Teams-included plan to a Teams-excluded plan at each annual anniversary of their term if they wish, without waiting for the full contract term to end. (This one-time-per-year switch only applies to dropping Teams from a bundle, not adding it mid-term.)

Implications & Recommendations:

• Review Renewal Timelines and Budget: Check when your current EA/MPSA agreements are up for renewal and what volume-based discounts you presently receive. If your budget has been assuming those discounts, prepare for higher costs at the next renewal once those discounts disappear. Adjust your financial plans to accommodate paying standard pricing going forward so there are no surprises.
• Reevaluate Purchasing Channels: Consider whether an EA is still the best fit for your organization under the new rules. Without volume-based price breaks, alternative purchasing channels like the Cloud Solution Provider (CSP) program may become more attractive. CSP agreements offer more flexibility (monthly or annual commitments without multi-year lock-in) and could be a better option, especially for small to mid-sized organizations that no longer gain an EA pricing advantage.
• Optimize License Usage: Before renewal, audit your license utilization and right-size your subscriptions. CSP is more flexible and allows for license optimization. Identify and eliminate any excess licenses and ensure users have appropriate license levels (for example, not everyone may need the most premium E5 tier if a less expensive E3 meets their needs). Optimizing usage now will help avoid paying for unnecessary capacity later.
• Leverage Expert Guidance: We can help you model the specific impact on your costs, identify cost-saving opportunities (such as utilizing the new “without Teams” subscription options or shifting to a different licensing program), and plan any adjustments. Proactive planning with an expert will ensure your organization is ready to adapt and can take advantage of any new flexibility while mitigating cost increases.
  
  

Conclusion:

Microsoft’s licensing changes taking effect on November 1, 2025 will bring greater transparency and consistency to pricing, but may also increase costs and require customers to manage their licenses more closely. By planning ahead and understanding these changes, organizations can avoid unpleasant surprises and take advantage of new flexibility. Now is a good time to review your licensing situation and ensure you’re prepared to handle these changes with confidence.