UK enterprises that use Microsoft software or cloud services are in for unwelcome surprises: stiff price increases when their contracts are renewed.
Enterprise software cloud prices are going up 22 percent and enterprise software will climb 13 percent.
In a blog post on its TechNet British site, Microsoft officials explained the price increases are designed to ensure "reasonable alignment across the region."
Affects New & Existing Contracts
The price hikes affect new contracts signed as of January 2017. They will also affect renewals of existing contracts for services including Office 365 subscriptions.
While the post doesn’t specifically state it, the price increases are directly related to Britain's June 23 vote to leave the European Union — the so called Brexit vote. Against the dollar, the British pound is hovering around the $1.22 mark, down about 18 percent from the day of the referendum.
Microsoft said the price increases are similar to recent “harmonization adjustments” with the Norwegian krone and Swiss franc.
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“Even after this adjustment, customers across the region buying in British pounds will still find our cloud offerings highly competitive,” the post reads.
Microsoft Post-Brexit
Despite the Brexit vote, Microsoft is still investing in the UK.
In September, Microsoft announced it was opening data centers in the UK, with the UK Ministry of Defense one of the first customers to sign up. A number of other public service clients are also reportedly considering a move to Office 365.
Microsoft isn't the only company to raise its prices in the UK because of the change in the value of the pound. Dell has already increased its prices and other global companies are likely to follow.
