Optimizing Microsoft 365 licences

Optimize your Microsoft 365 license spend with our tips | Arxus

blog

How to optimize your Microsoft 365 license spend with CSP: 4 quick wins and 5 long-term strategies

Is managing your Microsoft 365 licenses a complex and costly part of your IT? You’re certainly not alone. With frequent price changes, expanding product families, and an ever-growing list of add-ons for security and AI, many organizations struggle to determine what they really need and how to avoid overspending. Ready to start optimizing your licensing costs? We’ll share some tips and best practices with you.

Wed, 15 April 2026

Tim Wolfers

Modern Workplace Lead, Arxus

4 quick wins to optimize your license spend

In recent years, Microsoft has introduced new licensing rules, term commitments, and product changes that make it harder for IT and finance teams to stay in control. However, as a Belgian Tier 1 Microsoft Cloud Solution Provider (CSP), we believe this complexity also creates opportunities for optimization. The key is to have a partner who can turn all that licensing chaos into a clear, cost-efficient strategy.

Recent changes to pricing, Teams, and Copilot licensing have made this optimization more important than ever. Before we discuss long-term planning, here are four time-sensitive actions you could take today.

1. Avoid the 5% uplift on monthly billing

If you’re on an annual subscription but pay monthly – also called annual term, monthly billing – this change is a critical one for you.

What changed?
For annual term subscriptions purchased or renewed after April 1, 2025, Microsoft applies a 5% surcharge when you choose monthly billing. You’re essentially paying a premium, purely for payment flexibility.
What can you do?
On your next renewal, switch your billing plan to annual billing. This simple change to your billing cycle instantly negates the 5% price increase. For new purchases, choose annual billing when ordering to save costs.

2. Revisit your Teams licensing in the EEA

Teams licensing in the EEA has changed twice in a short period. If you haven’t reviewed your setup since late 2025, there’s a real chance you’re overpaying.

What changed?
Between April 2024 and October 2025, EEA organizations had to purchase Teams as a separate add-on. On November 1, 2025, Microsoft reintroduced the all-in-one bundles and adjusted pricing. Bundles without Teams became cheaper, while the standalone Teams add-on increased in price. If you’re still using a “suite + Teams add-on” combination, your setup is likely more expensive than necessary.
What can you do?
Check whether your organization is still using this two‑SKU setup. If so, move back to the all-in-one bundles. In many cases, this reduces your monthly cost immediately. Since mid-term upgrades to the bundle are possible, you do not have to wait for your renewal to start saving.

3. Switch to Copilot for Business bundles

For small and mid-sized organizations, Copilot licensing has become more accessible.

What changed?
In December 2025, Microsoft launched Copilot for Business, designed specifically for organizations with less than 300 users for € 18.20. The Enterprise Copilot add-on costs around € 26 per user, which is almost 30% more. On top of that, discounted bundles are available until June 30, 2026.
What can you do?
Review your Copilot spend. If you’re still using the Enterprise add-on, we can help you transition to the new Business SKU or bundle at your next renewal to lock in these lower rates.

4. Prepare for the new Extended Service Term (EST)

Starting May 4, 2026, Microsoft is officially ending the free 30-day grace period for expired subscriptions. This change affects any subscription purchased or renewed after April 1, 2025.

What changed?
If Auto-Renew is turned off but the subscription isn’t explicitly cancelled, Microsoft doesn’t grant a 30-day grace periode. Instead, they keep your services running (enrolling you in the EST) and bill you monthly – plus a 3% surcharge.
What can you do?
Be very explicit with your license partner. If you want to stop a subscription, make sure it’s actually cancelled at renewal. Simply turning off auto-renew isn’t enough anymore and can lead to unwanted costs.

5 strategies for long-term Microsoft 365 cost control

Quick wins help. But true savings come from structure and strategy. At Arxus, we use these five pillars to build a solid foundation for license governance.

1. Use an 80/20 blend for flexibility and savings

We recommend segmenting your workforce to balance costs with agility.

80% core users on annual terms for stability and lower cost. This should be the default for your permanent workforce, saving 20% on monthly premiums and avoiding the 5% uplift.
20% flexible users on monthly terms for contractors, seasonal staff, or growth spikes. Yes, monthly seats cost more per seat. But the flexibility to scale down prevents paying for unused seats for the remainder of a year.

Pro tip: 3-year terms

For very stable user groups (100+ seats), a 3-year commitment locks in today’s pricing for 36 months. That’s built-in protection against future Microsoft price increases.

More about 3-year licenses

2. Consolidate your software stack

Many organizations pay twice for the same feature, usually without realizing it. Standalone tools for antivirus, identity, storage, or even webinars often overlap with what’s already included in Microsoft 365 Business Premium or E5 licenses.

By auditing your third-party software subscriptions and fully adopting the features in your Microsoft 365 Suite, you can often reduce your total IT spend by 20% or more. That way, you’re not only saving on your licensing, you’re reducing your active vendors and simplifying your IT landscape.

3. Prevent silent overspending with active governance

Savings don’t come from cutting licenses alone, they come from ensuring every penny you spend creates value. We recommend a quarterly license health check.

Identify dormant licenses or orphaned accounts
These are paid seats assigned to disabled accounts or employees who have left, or inactive licensed (guest) users.
Analyze your usage reports
If someone only uses email and chat, they don’t need a premium E5 license. You can either drive adoption through targeted training or downgrade and reduce costs. Both approaches improve cost efficiency.

4. Stay agile with mid-term upgrades

A common misconception is that an annual NCE commitment locks you into a static feature set. In reality, you have built-in options to support unexpected growth. You can upgrade any license to a higher tier at any point during your term with zero penalty.

If a project suddenly requires advanced security or compliance, you can upgrade specific users from Microsoft 365 E3 to E5 instantly. You only pay the pro-rated difference for the remaining months of your contract. This flexibility lets you start lean, while staying ready to scale when your business needs it.

5. Protect your budget by aligning with your roadmap

If you already know what’s coming – Zero Trust, E5 adoption, advanced security – don’t wait to make your purchase. By committing to those licenses earlier with a 3-year term, you lock in current pricing for the next 36 months, protecting your budget from the inevitable price increases Microsoft implements over time. This way, you avoid paying 2027 prices for a 2026 plan.

Turn licensing into a strategic lever

As we move further into 2026, the landscape of Microsoft 365 licensing continues to reward organizations that stay proactive. With ongoing price changes and new rules like the Extended Service Term, staying static can quickly become expensive. The goal is to move beyond simply paying a bill and start managing your licenses as a strategic asset.

As a Belgian Tier 1 Direct Microsoft CSP, we help organizations navigate this complexity every day. Together, we turn licensing into clarity, control, and measurable impact.

Curious where you can cut more costs?

Feel free to reach out for a license review. Let’s build a Microsoft 365 strategy together that supports your growth, today and in the future.

Contact our experts for a license check | Arxus

Want more? Read on!

blog

Microsoft 365 subscriptions for 3 years via CSP | Arxus

Tue 17 Jun 25

Lock in your Microsoft 365 pricing for 3 years via CSP

Looking for predictability in your IT budget while taking advantage of attractive conditions? We’ve got good news: Microsoft is introducing a new subscription model for Microsoft 365 E3 and E5 under the CSP (Cloud Solution Provider) program. This allows you to lock in your license price for a full 3 years, giving you more control over your costs.

blog

Discover how Microsoft 365 Copilot improves your productivity | Arxus

Mon 10 Nov 25

Microsoft 365 Copilot: a new way of working and a gamechanger for productivity

Copilot, Microsoft's smart AI assistant, has fundamentally changed our (working) relationship with technology. But what makes Copilot such a powerful addition to the Microsoft 365 suite? And how does it increase your employees' productivity? Kevin Meuldermans, our AI specialist, explains what you can do with it and how to successfully integrate it into your modern workplace.