Happy New Year! Love, Microsoft: Price rises? Aw, you shouldn't have

Services Provider Licensing Agreements to jump 10% in 2018

Exclusive Microsoft has something that will compound customers' New Year hangovers for 2018 – a double-digit price hike.

According to documents seen by The Register, Microsoft will slap up to 10 per cent on the cost of certain flavours of Service Provider Licensing Agreements (SPLA) in the UK from next year.

"On January 1, 2018, Microsoft will introduce SPLA price changes for Windows Server, SQL Server, Core Infrastructure Server Suite and Remote Desktop Services," Microsoft confirmed in a missive to hosting firms and resellers.

A proposed 10 per cent hike will be applied to Windows Remote Desktop Services (RDS) subscriber access licence (SAL), Server Standard, Server Datacenter and Server Essentials; and another 10 per cent to flavours of SQL including Server Standard Core, SQL Server Enterprise Core, Server Web and Server Standard SAL. The CIS Suite Standard will jump 5 per cent and CIS Suite Datacenter by 7 per cent.

No price change is planned for Windows Server Standard Core, Windows Server Datacenter Core CIS Suite Standard and Suite Datacenter Cores.

"Prices are not final until the January SPLA price list is available on explore.ms. Microsoft will publish a price list preview on 1 December, 2017. Prices are subject to change before the preview," the doc stated.

Microsoft last upped prices in a big way at the start of this year, blaming the weakness of the British pound in relation to the US dollar. Price of on-premise software went up 13 per cent and cloud services by 22 per cent.

Hosting companies and resellers that received the communication were unable to explain the reasons for the change, but several indicated it could again be related to forex, even though the British pound has actually hardened against the US dollar in recent times.

All Microsoft suppliers The Register spoke to said they did not have the slack in the system to absorb these price rises.

"You have got to wonder how Microsoft can justify this," said one. "We don't make a margin on the licence anyway, we are effectively collecting them for free for Microsoft, so there is no headroom to say 'we'll reduce our profit'."

Another agreed: "We simply don't have the margin so will need to pass on these increases to customers."

The Register has asked Microsoft to explain why price rises are proposed, and will update the story when we hear back. ®

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