For many organizations, Microsoft 365 and SharePoint have become the backbone of collaboration. But as document libraries grow, so do storage costs and compliance headaches. Traditional archiving and manual cleanup no longer keep pace with the demands of modern enterprises. What IT leaders need today is automation: rules that ensure files are stored in the right place, at the right time, without breaking compliance or disrupting end users.
This is exactly what ShArc policy management delivers. By combining flexible offloading rules with a hierarchical structure tailored to Microsoft 365, ShArc gives US-based IT admins and CIOs the power to manage storage intelligently while keeping data secure inside their own Azure tenant.
Until now, Microsoft offered several discount levels ranging from A through D under frameworks such as the Enterprise Agreement (EA) and the Microsoft Products and Services Agreement (MPSA). Large organizations could secure substantial savings, often between 6% and 12%, depending on the number of licenses purchased. A multinational with thousands of Office 365 users, for example, might have negotiated a Level D discount worth hundreds of thousands of dollars annually. Starting later this year, however, all customers will fall into Price Level A , meaning everyone pays the standard list price for online services. The only exceptions will be certain government or educational agreements that use separate price lists.
Microsoft has framed the decision as part of an effort to “simplify” its pricing structures and “improve transparency.” While this reasoning sounds customer-friendly, the reality is less appealing for large enterprises that have long relied on volume discounts to control costs. For many, the removal of tiered pricing represents an effective price increase, one that could significantly impact IT budgets in 2026 and beyond.
This move underscores a broader shift in the software industry: the migration from ownership and perpetual licenses toward subscription-based cloud models. In traditional volume licensing, companies could buy perpetual software rights and renew support separately. In the new cloud world, customers subscribe and Microsoft retains ultimate control over access, pricing, and terms. Removing volume-based discounts reinforces that asymmetry.
Consider a medium-sized enterprise with 500 employees using Microsoft 365 E3 licenses. Under the previous MPSA model, it might have paid around €28 per user per month with a 10% discount, totaling about €151,200 annually. Without the discount, that figure jumps to roughly €168,000, an increase of more than €16,000 per year for identical functionality. Scale that across multiple services, and the financial implications become clear.
Microsoft’s argument for simplification has some merit. The company’s patchwork of agreements, EA, MPSA, Cloud Solution Provider (CSP), and others, has long been confusing, especially for smaller organizations. By consolidating pricing and pushing customers toward the CSP model, Microsoft ensures consistent billing and easier administration. However, this also centralizes control within Microsoft’s partner ecosystem and limits customer flexibility in negotiating custom terms.
In practice, it means that businesses will increasingly depend on Microsoft partners for licensing, renewals, and support often through managed service contracts. That can streamline operations for some, but for large enterprises with dedicated procurement teams, it represents a loss of autonomy. It also gives Microsoft more leverage to promote premium bundles like Microsoft 365 E5, further boosting its recurring revenue.
Enterprises now face a strategic choice: accept the higher list prices, or rethink their cloud licensing strategy. Some organizations may explore hybrid models, mixing on-premises products under traditional volume agreements with online services purchased through CSP channels. Others might reassess whether every user truly needs a full Microsoft 365 license especially for roles that rely mainly on email and basic productivity tools.
Additionally, competitors such as Google Workspace may see an opportunity to attract price-sensitive customers. However, switching ecosystems is rarely simple, given the deep integration of Microsoft products in most corporate environments. The most realistic response for many will be to optimize license usage auditing inactive accounts, consolidating subscriptions, and using management tools to avoid waste.
Another area where organizations may feel additional pressure is SharePoint Online storage. Many customers currently pay significant fees for extra cloud storage beyond the default allocation. Without volume-based discounts, these costs can escalate quickly. To mitigate the impact, IT departments should review their storage strategies. Identifying redundant or inactive data before purchasing more capacity. It may also be worth exploring alternative archival solutions, such as Azure Blob Storage or third-party options such as ShArc that offer lower rates for offloading cold data. Customers can download the official ShArc cost calculator here to estimate storage requirements, compare scenarios, and identify potential savings opportunities
The end of Microsoft volume licensing discounts for online services represents more than an administrative change; it is a strategic pivot toward uniform cloud pricing and greater revenue predictability. While the company presents it as simplification, the move ultimately reduces flexibility and raises costs for many enterprise customers. As the licensing landscape continues to evolve, organizations that proactively adapt through better license management, smarter contract negotiation, and strategic diversification will be best positioned to absorb the impact and maintain control over their IT spending.
Through offloading your cold data through ShArc you can safe on SharePoint Storage costs. In a world where we accumulate tons of data on a daily bases these cost can rise easily. Take a look at ShArc now and find out how it could help you safe money on SharePoint Storage