Office Commercial products sales fell 8 percent due to customers shifting to cloud offerings, Microsoft said. Within this segment, Office Commercial products and cloud services sales increased 20 percent, driven by Office 365 Commercial sales of 25 percent. In July, Microsoft announced during its quarterly earnings call that fourth-quarter sales in Microsoft’s productivity and business processes segment - which includes Office 365 Commercial sales - totaled $14.7 billion, up 25 percent year over year from $11.8 billion. Ten years in, however, the product suite continues to have technical issues and outages, from Teams sending calls straight into some users’ voicemails in June to an issue preventing some North American users from joining meetings in February.
Microsoft has introduced compliance capabilities such as Content Search, eDiscovery and core Litigation Hold. Over 10 years, Microsoft has introduced security capabilities for the product suite including data loss prevention (DLP) capabilities for email and documents, sensitivity labels and message encryption. The tech giant also launched the popular Teams collaboration application the same year. Microsoft introduced O365 in 2011 and introduced M365 in 2017, bringing together Office, Windows, enterprise mobility and security. In 10 years, the 365 product has grown to 300 million commercial paid seats, according to the company. Microsoft declined further comment regarding the price increases. And M365 E3 increases $4 from $32 to $36. M365 Business Premium increases by $2, from $20 to $22. On March 1, M365 Business Basic increases by $1, from $5 to $6 per user per month, according to the company.
“This updated pricing reflects the increased value we have delivered to our customers over the past 10 years,” Jared Spataro, the tech giant’s corporate vice president for Microsoft 365 (M365), wrote in a blog post Thursday announcing the news.
The increase, slated for March 1, comes after 10 years of added capabilities in areas including communication, security, compliance and automation. Microsoft announced “the first substantive pricing update” of Microsoft 365 and Office 365 since the debut of the cloud-based productivity and collaboration applications in 2011.
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