Author: Dan Briggs | Published: 11 June 2026 | Reading time: 15 minutes
Executive summary
When Microsoft announced its global Microsoft 365 price and packaging update on 4 December 2025, almost every headline focused on one half of the story: prices for most Business and Enterprise plans go up on 1 July 2026. We covered the pricing side in an earlier post, and if your renewal is approaching, that piece is still worth five minutes of your time.
This whitepaper is about the other half, which is now happening. Starting this month and finishing by 1 August 2026, Microsoft is rolling a substantial set of previously paid features into existing Microsoft 365 plans: Defender for Office 365 Plan 1, a suite of Intune management and security tools, doubled mailbox storage on Business plans, time-of-click phishing protection, and new Copilot Chat capabilities. Microsoft’s licensing update confirms customers receive at least 30 days’ notice in the Message Center before the changes land in their tenant, which means those notices are arriving in Australian tenants right now.
Why this matters to your bottom line: a meaningful share of the businesses we look after are currently paying a third party, or paying Microsoft separately, for something that is about to be included in their existing licence. Email security add-ons, remote support tools, device analytics, certificate management, standalone Defender plans. If you do nothing, you will simply pay the July price rise and keep paying for the duplicates. If you spend an hour on the audit we set out below, the new inclusions can offset some, and occasionally all, of the price increase.
There is also a deadline buried in this. Existing customers stay on current pricing until their first renewal on or after 1 July 2026, and several Microsoft partner promotions expire on 30 June. If your renewal falls later this year, the window to lock current pricing for another full term closes at the end of this month.
What Microsoft announced, and when each part takes effect
The December announcement bundled two separate changes that are easy to conflate:
- Pricing changes take effect 1 July 2026. They apply to new purchases immediately and to existing subscriptions at the first renewal on or after that date. Standalone Teams and Copilot licences are excluded.
- Packaging changes began rolling out in June 2026 and will be complete by 1 August 2026. These are additions only. Nothing is being removed from any plan in this update, and the new features arrive at no extra charge on top of the July pricing.
Microsoft publishes its list pricing in US dollars, and Australian pricing varies with currency and your agreement type, so the exact dollar figures on your invoice will differ. The percentages are the reliable guide: Business Basic rises about 16% (US$6 to US$7), Business Standard about 12% (US$12.50 to US$14), Office 365 E3 about 13%, Microsoft 365 E3 about 8%, and Microsoft 365 E5 about 5%. Business Premium is unchanged. The frontline plans cop the largest percentage rises, with Microsoft 365 F1 up 33% and F3 up 25%, which stings for hospitality groups licensing casual floor staff.
The rest of this paper concentrates on what you get, because that is the half of the announcement most businesses have not yet acted on.
What’s landing in each plan
Here is the feature rollout for the plans Australian SMBs and mid-market organisations actually run, drawn from Microsoft’s packaging tables.
| Plan | New inclusions (rolling out June to 1 August 2026) |
|---|---|
| Microsoft 365 Business Basic | Extra 50GB of mailbox storage (50GB to 100GB), URL time-of-click protection, Copilot Chat enhancements and Copilot Chat Analytics |
| Microsoft 365 Business Standard | Extra 50GB of mailbox storage, URL time-of-click protection, Copilot Chat enhancements and Copilot Chat Analytics |
| Microsoft 365 Business Premium | Extra 50GB of mailbox storage, Copilot Chat enhancements and Copilot Chat Analytics (Premium already includes Defender for Office 365 Plan 1, so time-of-click protection is not new here) |
| Office 365 E1 | URL time-of-click protection, Copilot Chat enhancements and Analytics |
| Office 365 E3 | Microsoft Defender for Office 365 Plan 1, Copilot Chat enhancements and Analytics |
| Microsoft 365 E3 | Microsoft Defender for Office 365 Plan 1, Intune Plan 2, Intune Remote Help, Intune Advanced Analytics, Copilot Chat enhancements and Analytics |
| Microsoft 365 E5 | Everything added to E3, plus Microsoft Security Copilot, Intune Endpoint Privilege Management, Microsoft Cloud PKI and Intune Enterprise Application Management |
| Microsoft 365 F1 / F3 (frontline) | Copilot Chat enhancements and Analytics |
| Enterprise Mobility + Security E3 | Intune Plan 2, Intune Remote Help, Intune Advanced Analytics |
You will not get to choose the arrival date. Watch for the Message Center notice in your tenant (your IT provider should be watching it for you), which gives at least 30 days’ warning before the features switch on.
What the new tools actually do, in plain terms
Defender for Office 365 Plan 1: the big one for E3 customers
Until now, Defender for Office 365 Plan 1 was a paid add-on (or part of Business Premium and E5). It is Microsoft’s serious email threat protection layer, sitting above the basic Exchange Online Protection every tenant gets. In practical terms it adds Safe Attachments, Safe Links, and impersonation protection: attachments are detonated in a sandbox before delivery, links are checked at the moment a user clicks them rather than only when the email arrives, and the system watches for senders pretending to be your CEO or your suppliers. It also extends protection to files shared through SharePoint, OneDrive and Teams.
Phishing remains the most common way Australian businesses get compromised, and business email compromise sits near the top of the ACCC and ASD business loss reports year after year. For an organisation on Office 365 E3 or Microsoft 365 E3, getting this layer included rather than paying roughly US$2 per user per month for it (or paying a third party more) is the single most valuable line in the whole announcement.
URL time-of-click protection for Business Basic and Standard
Business Basic and Standard users get a slice of the same capability: links rewritten and checked when clicked. This closes a gap attackers have exploited for years, where a link is clean at delivery time and weaponised hours later, after the email has sailed through filtering. It is not the full Defender for Office 365 package, and Business Standard customers handling payments or sensitive client data should still consider stepping up to Business Premium. But it is a real upgrade for the plans where Australian small businesses actually live.
The Intune additions: remote support and device intelligence for E3
Microsoft 365 E3 and EMS E3 customers receive four Intune components that were previously sold as the separate Intune Suite or as individual add-ons:
- Intune Remote Help is a remote assistance tool built into the Microsoft stack. Your support team (or your MSP) can view and control a staff member’s enrolled device through a session that respects your conditional access and compliance rules, rather than through a third-party remote tool with its own security posture.
- Intune Advanced Analytics surfaces device health data: which laptops are degrading, where startup times have blown out, which apps crash, battery health across the fleet. Useful evidence when deciding which machines to replace before they fail mid-quarter.
- Intune Plan 2 adds management for specialised and purpose-built devices, the kind of kit hospitality and logistics businesses run at the edges of their fleet.
- On E5 only, Endpoint Privilege Management lets standard users complete approved tasks that need admin rights without holding a permanent admin account (directly relevant to the Essential Eight’s privileged access restriction), Microsoft Cloud PKI replaces on-premises certificate servers, and Enterprise Application Management automates third-party app patching, which speaks straight to the Essential Eight patching controls.
Security Copilot arrives in E5
Microsoft 365 E5 customers also receive Microsoft Security Copilot, Microsoft’s AI security assistant, which until now carried its own consumption-based pricing that put it out of reach for most mid-market security teams. If you hold E5 licences, this is worth a proper look once it lights up in your tenant: it can summarise incidents, write hunting queries and triage alerts in plain language. We would not suggest anyone buy E5 for it alone, but bundled, it changes the value calculation for organisations already at that tier.
Copilot Chat enhancements across every plan
Every plan in the update, from Business Basic through E5 and the frontline SKUs, picks up Copilot Chat enhancements and Copilot Chat Analytics. Per Microsoft’s notes, the enhancements include inbox and calendar awareness and access to Word, Excel and PowerPoint agents. This is the no-extra-cost Copilot Chat, not the full US$30 Microsoft 365 Copilot licence, but the gap between the free and paid tiers keeps narrowing. The Analytics piece gives administrators visibility of who is actually using it, which is handy input for deciding whether paid Copilot seats are justified for specific roles. If you are deploying AI tools more broadly, our recent guide to deploying AI across your team covers the governance side.
The duplicate-spend audit: what you can stop paying twice for
This is where the money is. Run through these five questions before your renewal, with your IT provider if you have one:
- Are you paying for a third-party email security gateway? If you are on E3 or Business Premium, products in the Mimecast and Proofpoint class now overlap heavily with what your licence includes. There can still be good reasons to keep a third-party layer (archiving requirements, specific compliance features, defence in depth), but it should be a deliberate decision, not an artefact of a purchase made in 2021. Businesses on Basic or Standard get less, so the case for third-party filtering there remains stronger.
- Are you paying for Defender for Office 365 Plan 1 as an add-on? If you hold E3 licences with the Plan 1 add-on stacked on top, that add-on becomes redundant once the packaging change reaches your tenant. Diarise to remove it at renewal.
- Are you paying separately for the Intune Suite or its components? Remote Help, Advanced Analytics and Intune Plan 2 add-ons on E3 (and EPM, Cloud PKI or Enterprise App Management add-ons on E5) are about to be included. Same action: confirm the feature is live in your tenant, then drop the add-on.
- Does your remote support tooling overlap with Remote Help? Many businesses pay for standalone remote access tools per technician or per device. If your fleet is Intune-enrolled and your support workflow suits it, Remote Help may cover the same ground inside your existing security boundary.
- Are you paying for extra mailbox storage or running painful mailbox archive workarounds? With Business plan mailboxes doubling to 100GB, some storage add-ons and some of the awkward PST housekeeping can go. Worth checking which users were near the 50GB ceiling.
A note of realism from the field: we’re seeing clients assume the new features will configure themselves. They will not. Defender for Office 365 arrives with default policies that are serviceable but generic; Safe Links and impersonation protection in particular benefit from tuning to your domains, your suppliers and your executives. Included is not the same as deployed.
The 30 June angle: renewal timing and expiring promotions
Two clocks are ticking this month.
First, the pricing clock. Because existing subscriptions keep their current price until first renewal on or after 1 July 2026, an annual renewal completed in June locks today’s rates for a full further year. For a 25-seat business on Business Standard, the difference is roughly 12% of that line for twelve months. If your renewal naturally falls in the second half of 2026, ask your provider to model an early renewal now; sometimes the saving justifies it, sometimes contract terms get in the way, but June is the month to do the sums.
Second, the promotion clock. Microsoft’s fiscal year ends 30 June, and a stack of partner channel promotions expire with it, including discounts on new Copilot seats and bundles pairing Business Premium with Copilot, as catalogued in LicenseQ’s June licensing update. If a Copilot pilot or a Business Premium step-up was on your list for this calendar year anyway, pricing it before 30 June versus after is a sensible call to make this week, not in July.
We should be clear: there is no need to panic-buy anything. The packaging additions arrive regardless of when you renew. The June deadline only matters for price locking and promotional pricing on things you already intended to buy.
Three quieter changes in the same shake-up
SharePoint storage moves to pay-as-you-go
From early June 2026, Microsoft is introducing an opt-in pay-as-you-go billing model for SharePoint storage beyond your included quota, replacing the old approach of pre-purchasing fixed storage blocks. Flexibility is welcome, but consumption billing without monitoring is how surprise invoices happen. If your organisation is a heavy Teams and SharePoint user (and after a few years of recording every meeting, most are), check your storage position before opting in, and set budget alerts on day one.
Standalone SharePoint and OneDrive plans are being retired
Separately to the packaging update, Microsoft has retired the standalone SharePoint Online Plan 1 and 2 and OneDrive for Business Plan 1 and 2 licences. Sales to new customers ended on 31 May 2026, renewals stop from January 2027, and the services shut off entirely in December 2029. Most businesses on these SKUs picked them up years ago for a specific project or a small group of storage-only users. If that is you, there is no emergency, but your migration path (usually to Business Basic, a Microsoft 365 suite, or the new pay-as-you-go storage) should be settled before your next renewal rather than in a rush during 2027.
Windows 365 Business gets 20% cheaper
Going the other direction on price, Microsoft has permanently cut Windows 365 Business (the Cloud PC product for organisations up to 300 seats) by 20%, effective immediately for new customers and at renewal for existing ones. Cloud PCs are a tidy answer for contractors, seasonal staff and BYOD situations where you want a controlled corporate desktop without shipping hardware. At the new price point, they are worth re-evaluating if you dismissed them on cost in 2024 or 2025.
What this means for not-for-profits
Nonprofit pricing is tied to commercial rates at a 60 to 75% discount, so the July rises flow through to NFP pricing in percentage terms. The essentials for the NFP boards and managers we work with: Microsoft 365 Business Basic remains free for eligible not-for-profits, Business Standard rises from US$3.00 to US$3.50 list, and Business Premium holds at US$5.50. Critically, the packaging additions apply to nonprofit SKUs too, so an NFP on donated Business Basic licences still picks up the doubled mailboxes and time-of-click link protection at no cost. Given how many NFPs run lean on volunteer-managed IT, that free phishing protection upgrade may quietly be the most important security improvement many of them get this year.
How this lands in the industries we support
Professional services firms
Accounting, legal and financial advisory practices are the businesses most exposed to business email compromise, because their inboxes are where money gets instructed to move. They are also disproportionately likely to be sitting on Office 365 E3 or Microsoft 365 E3 with no advanced email protection, a combination we find in firms of 20 to 200 staff more often than anyone would like. For these firms, the Defender for Office 365 inclusion is the headline. The work between now and August is straightforward: confirm when it reaches your tenant, configure impersonation protection for partners and finance staff by name, register your common counterparties, and brief your team that link behaviour will change slightly as Safe Links rewrites URLs. Firms regulated by APRA or holding an AFSL should also note the device analytics and privileged access additions, which generate exactly the kind of operational evidence that CPS 230 reviews and client due diligence questionnaires keep asking for.
Hospitality groups
Hospitality wears the ugliest number in the pricing half: Microsoft 365 F1 up 33% and F3 up 25%. Venues licensing large casual workforces for rosters, comms and compliance training will feel that across hundreds of seats, and the frontline plans receive the thinnest packaging additions in return. Our advice is to treat this as the prompt for a licence-shape review rather than simply absorbing the rise. Many venues carry F3 where F1 would do, keep licences assigned to staff who left last season, or licence individuals where a shared device approach would be compliant and cheaper. A seat-by-seat tidy-up before renewal routinely saves more than the increase costs. Head office staff on Business Standard, meanwhile, get the same doubled mailboxes and time-of-click protection as everyone else, which matters in an industry where a single shared functions inbox can be both 48GB full and the target of every fake-booking phishing campaign going.
Action checklist
| Action | Why | When |
|---|---|---|
| Find your Microsoft 365 renewal date and seat counts | Determines whether the July price rise hits you in 2026 or 2027, and whether early renewal is worth modelling | This week |
| Decide on early renewal or pre-30 June purchases | Current pricing and FY26 channel promotions end 30 June | Before 30 June 2026 |
| Watch Message Center for your packaging rollout notice | Microsoft gives at least 30 days’ notice before features arrive in your tenant | June and July |
| List every security and management add-on you pay for (Microsoft or third party) | Identifies duplicate spend against the new inclusions | Before your renewal |
| Plan Defender for Office 365 configuration (E3 customers) | Default policies are generic; impersonation and Safe Links tuning does the real work | When the feature lands, by 1 August |
| Review SharePoint storage before opting into pay-as-you-go | Consumption billing needs monitoring and budget alerts from day one | Before opting in |
| Check for standalone SharePoint or OneDrive licences | End of sale has passed; renewals stop January 2027 | Before your next renewal |
| Re-price Windows 365 for contractor and BYOD use cases | Permanent 20% price cut changes the maths | Next planning cycle |
The bottom line
Microsoft has effectively repriced Microsoft 365 and repackaged it in the same move. The price half is done to you; the packaging half is an opportunity, but only if you act on it. Businesses that audit their add-ons and third-party overlaps between now and their renewal will claw back a decent slice of the increase. Businesses that file the Message Center notice under “later” will pay more for licences while continuing to pay separately for capabilities those licences now include.
Our team is running licensing reviews for clients through June and July: mapping seats to the right plans, identifying duplicate spend, modelling early renewals before the 30 June cut-off, and getting Defender for Office 365 properly configured as it lands. If you would like the same review for your business, call us on 1300 425 548 or get in touch online. An hour now is considerably cheaper than a year of paying twice.