Microsoft hikes prices of on-premises server products by up to 20%

Microsoft is hiking prices on its on-premises server products starting this month, and the increases aren’t minor. If you rely on local infrastructure, expect to pay noticeably more for several key services.

SharePoint Server, Exchange Server, and Skype for Business Server are all getting a 10% price bump this July. It doesn’t stop there. Microsoft’s Core CAL Suite and Enterprise CAL Suite are going up by 15% and 20% respectively.

These changes only affect standalone on-premises products. Microsoft’s cloud services, like SharePoint Online or Exchange Online, aren’t impacted. The company previously communicated these price changes, but now they’ve officially gone into effect.

Alongside the new pricing, Microsoft is pushing its updated subscription-based server models. The new Exchange Server Subscription Edition and Skype for Business Subscription Edition are now generally available.

These editions fall under Microsoft’s Modern Lifecycle Policy, meaning customers will get continuous updates instead of waiting for major version upgrades every few years. To use the new editions, you’ll need active Software Assurance or a cloud subscription license covering all users and devices.

In a blog post, Microsoft cited the ongoing cost of supporting on-premises software as a reason for the price jump. But declining revenue is also a factor. During its Q2 2025 earnings, Microsoft reported a 3% dip in its on-premises server revenue. The higher prices may help balance that decline, while also giving businesses a push toward the cloud.