What changed for EA renewals
For more than two decades, larger Microsoft customers received volume discounts automatically. Enterprise Agreement price levels B, C and D lowered the per-user price as seat counts grew. On November 1, 2025, Microsoft retired those levels for online services under the EA and MPSA. Microsoft 365, Dynamics 365, Windows 365, Copilot and Microsoft's security products now start at a single price that matches Microsoft.com, whatever the size of the customer.
The change applies at the next renewal on or after that date, or immediately to any online service added that was not already on the customer price sheet. On-premises licenses keep their price levels.
Then, on July 1, 2026, list prices rose across Microsoft 365. E3 moved from $36 to $39 per user per month and E5 from $57 to $60. A customer that held Level C or D pricing and renews after July 2026 absorbs both changes in the same renewal.
Not every customer can renew an EA
Microsoft has been steering smaller and cloud-only customers away from the Enterprise Agreement. Many are now offered the Microsoft Customer Agreement for Enterprise (MCA-E) or a Cloud Solution Provider (CSP) partner at renewal instead. Eligibility is decided account by account, so the first question for any renewal is which agreement Microsoft intends to offer, and whether that suits the business.
The choice matters. An EA fixes prices for its three-year term. MCA-E does not carry the same price lock, and CSP pricing runs through the partner. Each route changes what can be negotiated and for how long.
Where renewals typically cost more than they should
- Seats
Paying for licenses nobody uses
Leavers, duplicate accounts and service accounts keep licenses assigned. At renewal, the inflated count becomes the new commitment for three years.
- True-up
Letting the true-up set the baseline
Growth added through the year is billed at renewal and carried forward. Without a reconciliation first, the renewal starts from the highest number of the term.
- Tier
Buying E5 where E3 does the job
The gap between E5 and E3 is $21 per user per month at list. Assigning E5 broadly when only some groups use its security and compliance features is one of the most common sources of excess spend.
- Add-ons
Committing to AI and Azure ahead of demand
Copilot seats and Azure commitments are often bundled into renewals to reach a better headline discount. Unused commitment is still paid for.
- Timing
Starting when Microsoft does
Microsoft often opens renewal conversations only a few months before expiry. Starting at that point leaves little time to clean up counts, price alternatives or plan around Microsoft's quarter and year end.
What to expect
Since November 2025, any price below list has to be negotiated rather than granted, so the first proposal is an opening position, not a final number. Renewals that go well usually start well before Microsoft's timeline, with a clear view of what the business actually uses.
Where Deal IQ comes in
This page covers what has changed and where the cost sits. Turning that into a better price on your contract is the negotiation itself. Deal IQ has run 270+ Microsoft negotiations covering $2.4B+ in contract value, with a network of 350+ former vendor sales, pricing and deal desk leaders that includes people who sold Microsoft. We negotiate directly with Microsoft or behind the scenes with your team, and our fee comes from the savings.
Frequently asked questions
Can a Microsoft EA still be negotiated after the November 2025 changes?
Yes. The change removed automatic volume discounts for online services. It did not stop Microsoft from pricing below list. Reductions are now negotiated rather than granted.
When does the July 2026 price increase hit an existing EA?
At the first renewal after July 1, 2026. Agreements renewed before that date keep their prices until the next renewal.
How early should we start preparing for an EA renewal?
Well before Microsoft's timeline. Renewals that start early leave room to understand what the business actually uses before the first proposal arrives.
Do on-premises licenses lose their volume discounts too?
No. The November 2025 change applies to online services. On-premises licenses under the EA keep their price levels.
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