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Microsoft cuts Office 365 pricing due to 'efficiency'

Microsoft has cut its pricing for Office 365, less than a year after introducing the cloud-based productivity suite.Most of the Office 365 for enterprise plans saw price cuts of up to 20 percent on Wednesday, in a move Microsoft said was down to increased efficiencies.
Written by David Meyer, Contributor on

Microsoft has cut its pricing for Office 365, less than a year after introducing the cloud-based productivity suite.

Most of the Office 365 for enterprise plans saw price cuts of up to 20 percent on Wednesday, in a move Microsoft said was down to increased efficiencies. The service, which competes with Google Apps, only came out of beta eight months ago.

"As we rapidly add customers, the cost to run Office 365 becomes more efficient," Office product management chief Kirk Koenigsbauer wrote in a blog post. "This is the beauty of the cloud where we can deliver economies of scale through our worldwide data centers and economies of skill with our engineers, administrators, and support teams operating the service."

"With these efficiencies, we're able pass on savings to make it even more affordable for customers of all sizes to move to Office 365," Koenigsbauer added.

A full Office 365 for education service will roll out in the summer, but educational facilities can already get Exchange Online and Lync Online. Koenigsbauer said the A2 service plan for Office 365 for education, which "includes the core capabilities of Exchange, SharePoint, and Lync and the Office Web Applications", would be free to students, faculty and staff.

The UK page for the enterprise version of Office 365 already reflects Microsoft's pricing changes, with the lowest tier of support now costing £5.25 per user per month.

Before Wednesday, that tier cost £6.50 per user per month. The top tier's pricing has fallen from £18 to £14.50 per user per month.

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