How to Negotiate a Cap on Microsoft Renewal Price Uplifts

How to Negotiate a Cap on Microsoft Renewal Price Uplifts

Introduction: Microsoft Enterprise Agreement (EA) renewals are notorious for built-in price increases. If you simply roll into a renewal without pushback, you could face a “standard” uplift of 10–15% (or more) on your licensing costs.

The good news is that renewal price hikes are negotiable. By preparing well and leveraging your position, you can negotiate a cap on any renewal price uplift – or even eliminate it – to protect your IT budget.

This guide explains what uplift caps are, why they matter, and how to secure them in your Microsoft renewal negotiation.

Read our ultimate guide to Microsoft Renewal Negotiations: How to Beat Price Uplifts and Secure Discounts.

Understanding Microsoft Renewal Price Uplifts

When your Microsoft EA comes up for renewal, the default proposal often includes higher unit prices for your licenses and services.

This increase in the renewal price uplift can happen for several reasons:

• “Standard” Renewal Increase: Microsoft commonly applies a 10–15% uplift at EA renewal as a baseline, assuming customers will accept some increase.
• Inflation and Currency Adjustments: Microsoft periodically updates its global price lists (for example, implementing a region-wide 5–10% list price increase to adjust for inflation or currency fluctuations). If your renewal coincides with one of these adjustments, your costs can jump even if your usage stays the same.
• Discount Rollbacks: Another subtle tactic is reducing the discount you had in your last EA. For instance, if you previously enjoyed a 20% discount off list price, Microsoft might come back with only 10% off this time – effectively raising your net price even if list prices were unchanged.
• New Product Premiums: At renewal, you’ll be pitched new products or upgrades (like moving from E3 to E5, or adopting Microsoft’s latest AI add-on). These often come at a higher unit cost, contributing to overall uplift if adopted.

In short, if you do nothing, your Microsoft renewal will likely cost significantly more than your last term. A 10% uplift on a $1 million agreement means an extra $100,000 per year – a substantial hit to your budget.

That’s why negotiating a cap on these price uplifts (or preventing them altogether) is a critical goal for any savvy CIO or procurement lead.

How to get a better deal on your renewal, Microsoft Renewal Discounts: How to Get a Better Deal the Second Time.

Why You Need an Uplift Cap

Securing an uplift cap means writing into your contract that Microsoft cannot raise your prices beyond a specified percentage at renewal (and sometimes year-over-year during the term).

Here’s why having an uplift cap is so important:

• Budget Predictability: An uplift cap (say no more than 5%) gives you confidence that a double-digit cost increase won’t blindside you. This predictability is crucial for CFOs and budget planners over multi-year periods.
• Cost Savings: Every percentage point of avoided uplift is money saved. For example, capping a renewal increase at 5% versus a potential 15% could save hundreds of thousands of dollars over the term. (See the table below for a simple illustration of savings.)

Table: Potential Impact of Different Renewal Uplift Rates on a $1,000,000 EA

• Protection Against Vendor Tactics: With an agreed cap, Microsoft can’t quietly remove your discounts or apply arbitrary list price hikes beyond that threshold. It forces their sales team to work within your limit.
• Leverage for Other Concessions: Establishing that you won’t accept a big uplift puts Microsoft on notice. Often, this pressure leads them to offer alternative concessions (like a bigger discount or free add-on services) to make the deal attractive while respecting the cap.

In essence, an uplift cap shifts risk away from you and back onto Microsoft. It’s a form of insurance against escalating costs. Without it, all the discounts you negotiated can be eroded by one renewal cycle of price increases.

The earlier you start, the higher the chance of success. Microsoft EA Renewal Timeline: Planning 18 Months Out for Success.

Preparing to Negotiate a Price Uplift Cap

Like any negotiation, success in capping renewal price increases starts long before you’re sitting across from Microsoft’s reps.

Preparation is key:

• Start Early (12+ Months Out): Begin internal discussions a year or more before your EA expires. Early planning ensures you won’t be forced to accept a last-minute high quote due to time pressure.
• Audit Your Current Spend and Usage: Know exactly what you’re paying now per license and how much of what you buy is actually used. If you find shelfware (unused licenses) or overspending, plan to eliminate it at renewal – this reduces your baseline and gives you a stronger case to refuse any increase.
• Determine Your Increase Threshold: Work with finance to decide the maximum acceptable increase (if any). For many organizations in 2025’s economic climate, the answer might be 0% (flat renewal) or something tied to inflation (~2–3%). Having this internal target clarifies your stance.
• Gather Market Insights: Understand if Microsoft has announced any upcoming list price changes that could affect you. Also, research if other organizations have negotiated flat renewals or low uplifts – this peer info bolsters your confidence that you’re not asking for the impossible.
• Align Stakeholders on Strategy: Ensure your CIO, CFO, and any other approvers are on board with taking a firm line on pricing. If everyone agrees that “we will not approve a renewal above X% increase,” Microsoft will have to deal with a unified, resolute customer.

Checklist – Preparing to Negotiate an Uplift Cap

• ✓ Audit License Usage: Identify underused or unused licenses to remove at renewal (strengthens your case for lower cost).
• ✓ Know Your Current Pricing: Document what you pay now per product and your discount % off lthe ist. This is your baseline to defend.
• ✓ Set Your Cap Goal: Decide if you’ll push for a 0% increase or a specific cap (e.g., max 3–5%). Base this on budget limits and any relevant inflation metrics.
• ✓ Gather Leverage Data: Research Microsoft’s recent price hikes, competitor pricing, or CSP/MCA alternatives. Prepare these as talking points to counter any “that’s our standard increase” claims.
• ✓ Executive Backing: Confirm with leadership (CIO/CFO) that holding the line on price increases is a top priority, so you have air cover during tough negotiations.

Being well-prepared with data and a clear mandate sets the stage for a successful negotiation. Microsoft’s team will realize you’ve done your homework and are serious about controlling costs.

Leverage Points to Support Your Case

When negotiating an uplift cap, you’ll need to present compelling reasons and leverage to get Microsoft to concede.

Here are key leverage points and tactics:

• Alternate Sourcing Options: Remind Microsoft that you have options outside of a traditional EA. For instance, Cloud Solution Provider (CSP) or Microsoft Customer Agreement (MCA) channels might offer competitive pricing or month-to-month flexibility. If Microsoft won’t agree to reasonable terms, you could opt to shift some licenses to these channels (even if just temporarily). The implicit threat of moving spend away from the EA can pressure Microsoft to keep prices in check.
• Comparison to Competitors: In areas like cloud services, mention that you’re evaluating AWS, Google, or other competitors. Even if switching isn’t immediate, the possibility that the budget could shift to a competitor makes Microsoft more eager to accommodate requests like price protections. Be sure to keep such statements credible and not overly bluffing.
• Downsizing and Deployment Cuts: Make it clear you are prepared to reduce your Microsoft footprint if the renewal isn’t financially viable. For example, “If costs go up 10%, we will be forced to drop 500 Office 365 licenses or not roll out Product X enterprise-wide.” This suggests that Microsoft may stand to lose revenue or market share by insisting on a significant increase.
• Future Growth as Carrot: Conversely, leverage any planned increase in usage as a bargaining chip. If you anticipate needing more licenses or new Microsoft products in the next term, use that as an incentive: “We are willing to commit to Microsoft’s platform expansion (e.g., adding Azure workloads, adopting Dynamics, etc.), but only if our base pricing remains stable (0% increase).” Essentially, Microsoft gets more volume, and you get price protection – a win-win.
• Fiscal Year-End Timing: Microsoft’s sales teams are hungry for deals as the fiscal year-end (June 30) or quarter-end approaches. If your renewal timing is advantageous (Q4 or Q2 of Microsoft’s fiscal year), use that timing. Let them know that a signed renewal (with your terms) by that date will help them, implying that without those terms, you’re willing to delay or extend. If your renewal isn’t naturally aligning with a quarter-end, consider negotiating a short extension to push the final decision into a high-pressure period for Microsoft. That urgency can translate into concessions, such as an uplift cap or additional discounts.
• Executive Escalation: Don’t be afraid to escalate your negotiation to Microsoft’s higher-ups if you hit resistance. A regional sales manager or enterprise VP at Microsoft may have more latitude to approve special terms (like a price cap clause), especially for a strategic customer. Sometimes, simply cc’ing a Microsoft executive or having your CIO make a call can elevate the importance of your deal, resulting in more flexibility on their side.

By marshalling these leverage points, you make a strong business case: either Microsoft works with you on controlling price increases, or they risk losing business. Remember, at renewal time, you have the power to say “no” – use that power to insist on terms that keep your costs in check.

Negotiation Strategies for Securing an Uplift Cap

When negotiation conversations begin, be proactive and firm in pursuing a cap on price increases.

Here are strategies to employ:

• Set the Expectation Early: From the first meeting or RFP response, state your expectation: “Budget stability is crucial for us – we need renewal pricing with no more than a ___% increase.” By putting this stake in the ground up front, you frame all further talks around how (not if) to achieve that.
• Aim for 0%, Settle for Low Single Digits: Start by asking for a 0% uplift (flat pricing) on renewal. Microsoft may push back hard, citing rising costs or “standard practice.” Stick to your guns initially – you can always concede to a small increase later, but if you start by asking for 5%, you might end up with 8–10%. It’s often possible, especially for large customers or those willing to sign promptly, to get Microsoft to agree to flat pricing for the next term. If they absolutely won’t budge to 0%, negotiate the smallest cap possible (e.g., 2–3% per year or 5% total over the term). Emphasize that any increase above inflation is not palatable.
• Justify Your Position with Data: Back your ask with reasoning. For example: “Our industry is facing flat budgets; we simply cannot absorb a double-digit IT cost increase for the same services.” Or, “Inflation is around 3%, so a 10% hike is not justifiable – we’re willing to consider 3% as an absolute max to cover inflationary costs.” If you conducted a usage audit, highlight inefficiencies you’re already addressing (“We’re optimizing licenses internally, so we expect our spend to remain stable; an increase would undermine those efforts.”). Demonstrating financial savvy and constraints makes your case more credible.
• Trade Off for the Cap if Needed: Be prepared to give something if necessary – but make sure it’s something of lesser value than the cap is worth. For instance, you might agree to a slightly higher Azure commitment or add a handful of licenses of a new product that you were considering anyway, in exchange for Microsoft agreeing to your uplift cap. Another trade could be extending the contract term (e.g., committing to a 3-year renewal instead of doing a shorter term) if and only if pricing is locked. Important: Only offer concessions that align with your strategy (don’t agree to buy something useless just to get a cap – that defeats the purpose by adding cost elsewhere).
• Leverage Internal Approval as a Bargaining Chip: You can use your organization’s approval process as a tactical tool. For example: “Our CFO will not sign off on this renewal if it’s above a 5% increase – it’s a hard cap in our budgeting.” This sometimes helps the Microsoft rep by giving them something to take to their bosses: “The customer’s finance team has a firm policy, we need to meet this cap or the deal could fall through.” It shifts the narrative from you “wanting” a cap to you “needing” it for deal approval.
• Ensure Discount Integrity: Push to retain or improve your current discount percentages as part of the renewal. While this isn’t the same as a price cap, it prevents Microsoft from sneaking in an uplift by cutting your discount. Make it explicit that any list price increases must still honor your discount % (or the agreed capped price). For example, if Microsoft raises global prices 10% but you have a clause that the discount stays 20% off the list, you at least won’t lose ground on the discount front. Ideally, combine this with a cap: e.g., “list price increases won’t exceed 5% and our 20% discount will remain intact.” This two-pronged protection ensures you’re covered both on the list and net pricing.
• Don’t Yield to “Standard Policy” Arguments: You might hear statements like “Microsoft doesn’t usually put price caps in writing” or “Our standard renewal uplift is 10%, that’s just how it is.” Treat these as opening positions, not the final word. Many customers have successfully negotiated exceptions and special terms. If you encounter staunch resistance, politely remind them that every term is negotiable if the deal size and importance warrant it. Encourage them to find a creative solution (often they might come back with something like a larger discount to offset a higher list price – which, if effectively making your cost flat, achieves a similar outcome).
• Document Every Agreement: As you make progress, ensure that any commitment from Microsoft to limit pricing is captured in writing in draft documents or email. Verbal assurances are not enough. Work with your procurement or legal team to draft the exact language for the cap. For instance: “The unit price for Microsoft 365 E3 licenses in years 2025–2028 will not exceed 3% above the unit price in effect as of the 2024 EA end date, provided the license quantity remains at or above current levels.” The wording should be unambiguous about the percentage and scope. If Microsoft offers a pricing proposal document, make sure the price column for renewal year 1 is the same as the last year of the current EA (for 0% increase), or that any increase is clearly limited as agreed.
• Be Ready to Walk (or Wait): In negotiations, the side more willing to walk away has the leverage. If Microsoft absolutely refuses to meet your cap and you can delay the decision, use that. Sometimes letting the clock tick (without going past your expiration) can make Microsoft reconsider, especially if it means they might miss their quarter-end target. You could even prepare a contingency plan: for example, extend your current EA for 3–6 months (Microsoft often allows extensions) or shift critical licenses to monthly CSP subscriptions temporarily. These moves are last resorts, but showing you have a Plan B puts pressure on Microsoft to come back to the table with better terms.

Throughout these tactics, maintain a professional but firm tone.

You can be cordial with your Microsoft account team, but make sure they understand that controlling cost increases is a non-negotiable priority for you. By combining a strong stance with well-reasoned arguments, you significantly increase the chances that Microsoft will concede to an uplift cap.

Setting Realistic Expectations for the Cap

It’s important to enter negotiations with a sense of what kind of cap is achievable. The ideal scenario is a 0% increase – essentially a price freeze – but your mileage may vary based on your company’s size, spend, and Microsoft’s view of the account.

Here’s how to gauge your target:

• Push for Flat Pricing: Many organizations have successfully renewed their EAs with no price increase at all, especially if they were willing to sign early or make other commitments. Don’t assume you must accept any increase; Microsoft may not offer flat pricing upfront, but with pressure, it can happen.
• If Not 0%, Keep It Single-Digit: If a small uplift is unavoidable, aim to keep it in the low single digits (1–5%). Think of this as essentially tied to the cost-of-living or inflation at most. A double-digit increase in one leap is excessive in most cases. Microsoft might propose something like “5% now and 5% in year 3” or similar; remember, even 5% compounded can add up, so negotiate those numbers down as much as possible.
• Cap Each Year vs. Entire Term: Clarify whether the cap is per year or for the whole term. For example, a 5% annual cap would result in approximately 15% over three years if applied each year. Ideally, structure it as a cap on the entire renewal uplift (e.g., “no more than 5% increase from current prices over the next term”). If it’s phrased annually, try to get it very low (like 2%/year). If phrased as a one-time renewal cap, ensure it doesn’t reset mid-term.
• Focus on High-Cost Products: If you can’t get everything capped, focus on the big-ticket licenses. Ensure that your major spends (Windows/M365 E3/E5 suites, key server products, Azure consumption rates) have the protection. If a minor SKU that’s 1% of your cost goes up 10%, that’s not as critical. Concentrate your negotiation capital on the items that would hurt the most if their price jumped.
• Understand Microsoft’s Constraints: Occasionally, Microsoft might claim it cannot cap a certain product’s price due to global policy (for instance, if a price increase for that product is already scheduled globally). In such cases, negotiate an equivalent safeguard – perhaps an expanded discount to offset any list increase. The form of the protection matters less than the result: you pay no more than your agreed cap amount.
• Document the Baseline: Have the final agreement list the exact current prices or discounts that are being capped. This avoids any confusion later about what “5% increase” means (5% of what number?). For instance, if Office 365 E3 is $X per user now, the contract might say “not to exceed 1.05 * $X.” Being precise prevents loopholes.
• No Cap, No Deal: Be mentally prepared (and have internal buy-in) to walk away if your minimum goal isn’t met. It’s better to pursue an alternate route for a year than lock into a bad 3-year deal that breaks your budget. Ironically, being genuinely willing to say “no” often results in Microsoft finding a way to meet your requirements.

Realistically, most enterprises in negotiations have secured outcomes like 0%, 3%, or 5% uplifts at renewal when they pressed the issue. Anything higher suggests you might not be using all your leverage.

By setting a firm, realistic cap goal and sticking to it, you greatly increase your chances of coming out of the renewal with a manageable cost structure.

Closing the Deal: Get It in Writing

As you reach the final stages of your renewal negotiation, it’s time to lock down the uplift cap on paper:

• Explicit Contract Language: Make sure the final EA amendment or renewal documentation explicitly states the cap or price lock. Vague wording like “subject to Microsoft pricing at time of renewal” is unacceptable. Instead, it should have concrete language such as: “The unit prices for products A, B, C on the new EA will remain at the same level as the prior EA for the first 36 months,” or “shall not increase by more than 5% versus the prior term pricing.” If your contract has a special terms section, use it to spell this out.
• Cover Support Costs if Applicable: If you’re also renewing Microsoft Unified Support, negotiate a cap on those fees as well, since support costs often scale with your license spend. For example, “Support fees will not increase by more than 3% year-over-year”. It’s wise to align support cost protections with license cost protections so savings in one aren’t eaten by the other.
• Double-Check Quote and Order Forms: Before signing, review the final quote or price sheet Microsoft provides. The year-one pricing of the renewal should reflect the capped increase (or none at all). If you negotiated flat prices, verify that they reflect the current unit prices. If any pricing appears to be incorrect, now is the time to identify and correct it.
• Get Both Parties’ Sign-off: Sometimes, a cap might be documented in an email or side letter if not in the standard EA template. If so, ensure Microsoft co-signs it and ideally attaches it to the contract. The safest route is always to include it in the EA itself; however, it should have legal standing regardless of how it is recorded. Do not rely on salespeople’s promises like “Don’t worry, we’ll honor that” without formal documentation.
• Know the Renewal Term Length: Confirm how long the cap or price lock is in effect. In most cases, it will be for the duration of the new EA (e.g., 3 years). If you negotiated any pricing assurances for beyond the term (like an option to renew again at a capped rate), make sure that’s clearly stated too. It’s less common, but some deals might include a “next renewal not-to-exceed X%” clause – if you got that, fantastic, just be sure it’s written clearly.
• Final Executive Review: Have your legal/procurement team and an executive sponsor give a final review to the documents, specifically focusing on pricing terms. They should verify that the cap and any related provisions are as negotiated. This extra set of eyes can catch any last-minute discrepancies or omissions.

Closing a Microsoft renewal deal with an uplift cap in place is a significant win.

By insisting on proper documentation, you ensure that the victory is real and enforceable. Once the ink is dry, you can breathe easier knowing you won’t face unwarranted price jumps for the term of the agreement.

Post-Renewal: Verify and Monitor

Your job isn’t completely done once the contract is signed. Immediately after renewal, and throughout the term, take a few steps to verify and maintain the benefits of your negotiated cap:

• Verify First Invoice: When you receive the first billing or invoice under the new agreement, cross-check the unit prices. They should match the capped amounts. Mistakes can happen in the billing system, but if you spot them early (e.g., an unexpectedly higher rate), you can invoke the contract to get it corrected.
• Communicate Internally: Let your finance and IT teams know about the capped pricing. This helps in budget planning for the next few years. They’ll appreciate knowing that, say, the Office 365 costs will remain flat or only slightly rise as per the cap. It also sets a precedent internally that IT negotiated favorable terms, which can be useful for your credibility.
• Monitor Microsoft Announcements: Keep an eye on Microsoft’s pricing announcements. If Microsoft broadly raises prices or changes licensing (which they tend to announce on their website or through partner communications), you should assess whether your agreement shields you. With a cap, you generally don’t need to worry – but staying informed ensures you can proactively address any discrepancies. For example, if a press release says “Product X increases 10% for new purchases next year,” you’ll want to ensure your renewal pricing for Product X stays at your capped level.
• Maintain the Relationship (Strategically): You won the cap this time; however, Microsoft will be looking to recover revenue in other ways (upselling new services, for instance). Continue managing the relationship by periodically reviewing your usage and needs to ensure they align with your current requirements. If mid-term, you decide to add something significant (like a new bundle of licenses), remember to negotiate price protections for those additions too.
• Prepare for Next Renewal Early: Time flies in a 3-year term. Use the breathing room you got to start planning the next negotiation well in advance. Ideally, your next renewal discussion will benefit from the precedent you just set – Microsoft now knows you’re a customer that doesn’t accept arbitrary price increases. Leverage that reputation in future talks.

By staying vigilant post-renewal, you ensure that the uplift cap you fought for truly delivers its value.

No surprises, no creeping costs – just the pricing stability you negotiated. And if anything ever seems to deviate from the agreed terms, you have the contract to back you up in discussions with Microsoft.

Microsoft Renewal Uplift Cap Negotiation Checklist

Before we conclude, here’s a quick checklist to make sure you’ve covered all bases in negotiating and securing your price uplift cap:

• ✓ Early Start: Begin the renewal planning and internal alignment 12–18 months out. Don’t let timing pressure force you into accepting price hikes.
• ✓ Usage & License Audit: Identify where you can reduce or optimize licenses. A smaller renewal footprint means a smaller target for any uplift (and strengthens your ask for stable pricing).
• ✓ Set a Firm Cap Goal: Decide your no-go point (0% ideal, or X% max). Communicate this goal to Microsoft at the outset of negotiations.
• ✓ Use Leverage: Prepare alternative plans (CSP, other vendors) and be ready to show you have choices. Leverage Microsoft’s quarter/fiscal-end to get what you need.
• ✓ Negotiate Hard on Terms: Insist on contractual price protections – whether as a fixed price, a % cap, or maintaining discounts. Don’t accept verbal assurances; aim for written clauses.
• ✓ Trade Wisely: If concessions are needed, trade for things that matter to Microsoft but are manageable for you (for example, slightly higher volume or a longer commitment) – never at the expense of losing the cap.
• ✓ Lock the Contract: Review final paperwork to ensure cap language or fixed pricing is clearly stated. Have your legal team confirm it aligns with what was promised.
• ✓ Verify After Signing: Check initial bills and license portals to confirm pricing is applied correctly. Raise any issues immediately while the negotiation context is fresh.
• ✓ Continuous Oversight: Throughout the EA term, keep an eye on usage and any Microsoft pricing changes. Ensure your cap holds and be ready to enforce it if needed.
• ✓ Document for Next Time: Keep a record of how you achieved the cap, any contacts or approvers involved, and the exact terms. This becomes invaluable intelligence for your next renewal cycle.

Following this checklist will help ensure you not only negotiate the cap effectively but also reap the benefits of that negotiation in practice.

FAQs

Q: What is a “standard” Microsoft renewal uplift if I don’t negotiate it?
A: Microsoft often initially proposes around a 10% (or higher) increase on your expiring EA’s pricing. We’ve seen cases from 5% (if you’re lucky or market conditions are soft) up to 15–20% (especially if new products are included). This “standard” uplift isn’t a hard rule, but it’s a common starting point if customers don’t actively push back.

Q: Can we really negotiate a 0% increase (flat renewal)?
A: Yes – it’s possible to achieve a 0% increase, particularly if you’re a large customer or have strong leverage. Microsoft won’t offer a flat renewal, but with the right strategy (early negotiation, exploring potential alternatives, and a willingness to walk away), many organizations have secured no price increase on their core licenses. Even if you can’t get 0%, you can almost always push the uplift down to a minimal level (like 2–3%). It never hurts to ask; the key is demonstrating why holding the line on cost is justified.

Q: How do we phrase a price uplift cap in the contract?
A: It should be written as a clear limitation on price changes. For example: “For the duration of the EA renewal term, the unit price for Product X will not exceed Y% above the unit price effective as of [date]” or “annual price increases, if any, shall be capped at Z% per annum for Products A, B, C.” The phrasing might differ based on how your contract is structured, but it must unambiguously set the maximum increase allowed. Work with your legal team to get the wording right and make sure Microsoft signs off on it.

Q: What if Microsoft says they have a policy against adding price caps?
A: This is a common pushback. Microsoft representatives might claim they “don’t usually include caps” or that it’s not in their standard terms. Remember, standard terms are starting points. If you’re a significant customer or the deal is important, exceptions can be made. If you face this response, ask them to explore alternative ways to ensure price stability (such as extended price locks, multi-year rate cards, or larger discounts to offset future increases). Often, involving a higher-level Microsoft contact or your Microsoft reseller/LSP can help find a creative solution. Ultimately, Microsoft wants to close the deal, and if a cap is what it takes, they have leeway – especially at the end of the quarter or for strategic clients.

Q: Does negotiating an uplift cap affect other parts of the deal (like discounts)?
A: It could. Microsoft views the overall economics of the deal, so if you’re pushing hard to eliminate price increases, they might be less flexible on initial discounts, or vice versa. For instance, you might choose between a slightly better discount vs. a tighter price cap. What’s important is looking at the total cost over the term. Often, accepting a slightly smaller upfront discount in exchange for a firm cap on future increases results in a lower total cost by the end of the three-year period. Ideally, you get both a great discount and a cap – and strong negotiation can achieve that – but be prepared to balance these elements. Always run the numbers on different scenarios to see which combination yields the best financial outcome for your organization.

Q: If Microsoft announces a global price increase during my term, will my cap protect me?
A: Yes, if negotiated correctly. A well-written cap or price lock means that even if Microsoft raises the list price for everyone else, your pricing remains shielded up to the cap limit. Say Microsoft announces a 10% hike on a product next year – if you capped increases at 0%, you won’t pay that hike. If you capped at 5%, you would only be subject to 5% at most, not the full 10%. The key is ensuring your contract language doesn’t have loopholes. In some cases, Microsoft might exclude certain extraordinary events from caps (they shouldn’t, but watch out for it). By and large, a negotiated cap is your safety net against broad adjustments. Always double-check with Microsoft during negotiation: “This clause means that even if list prices change, our price is capped, correct?” to have a mutual understanding.

Q: Should we align our Unified Support renewal with the EA negotiation for price caps?
A: Absolutely consider it. Microsoft Unified Support fees are often a percentage of your license spending. If your license costs go up, support costs can rise in tandem. It’s wise to negotiate support at the same time and seek a cap on support fee increases as well. For instance, if you secure a 0% license increase but then Microsoft tries to raise support costs by 10%, that eats into your savings. Many customers negotiate a “not-to-exceed” clause on support renewal costs (e.g., support fees will not increase more than X% year-over-year). Coordinating these negotiations ensures that your total cost of ownership (licenses + support) remains under control. Microsoft account teams often bundle these discussions, so take advantage and tackle both in a unified way.

Five Expert Tips for Negotiating Uplift Caps

1. Start the Conversation: Don’t wait for Microsoft to mention price protections – bring it up first. Clearly state that controlling price increases is a top priority and a condition for your renewal. Early transparency sets the tone that you mean business.
2. Combine Cap with Usage Cuts: Strengthen your negotiating position by doing a license cleanup. When Microsoft sees you’re serious about cutting unused licenses and optimizing, they know you’ll walk rather than overpay. Dropping shelfware not only saves money but also reduces the amount to which an uplift would apply, making a cap more palatable to the vendor.
3. Use the “Competitive Quote” Tactic: Even if you intend to stay with Microsoft, obtaining a quote for an equivalent setup via CSP or a competing product can be a useful tool. Present it (tactfully) to show that you have alternatives that involve no big uplift. This often prompts Microsoft to match its stability or pricing to retain your business.
4. Don’t Settle for Boilerplate Terms: Microsoft might hand you a renewal quote and contract that looks boilerplate – challenge it. Redline the contract to insert your price cap clause. It signals you’re not a passive buyer. Be polite but persistent in reviewing and adjusting terms. The worst they can say is no, but more often they’ll come back with a compromise.
5. Make It a Win-Win: Frame the cap ask in a way that appeals to Microsoft’s interests too. For example, “With stable pricing, we can confidently get approval to expand our Microsoft usage over time.” Microsoft wants your account to grow; if you show that a price cap enables that growth (by keeping it affordable), they have an incentive to agree. In negotiations, presenting your demands as ultimately benefiting both sides can unlock faster agreement.

By following these expert tips and the guidance throughout this article, you’ll be well-equipped to beat Microsoft’s price uplifts and secure a renewal deal that respects your budget.

Remember, renewal time is your moment of maximum leverage – use it to not just win discounts, but also to lock in protections like uplift caps that ensure those hard-won savings last for the entire term and beyond.

With preparation, leverage, and a bit of bold negotiation, you can turn Microsoft’s “standard” renewal script on its head and emerge with a contract firmly on your terms.

Read about our Microsoft EA Optimization Service.

Do you want to know more about our Microsoft Services?

Please enable JavaScript in your browser to complete this form.

Name *

Email *

Company

Message *

Submit

Fredrik Filipsson

Fredrik Filipsson brings two decades of Oracle license management experience, including a nine-year tenure at Oracle and 11 years in Oracle license consulting. His expertise extends across leading IT corporations like IBM, enriching his profile with a broad spectrum of software and cloud projects. Filipsson's proficiency encompasses IBM, SAP, Microsoft, and Salesforce platforms, alongside significant involvement in Microsoft Copilot and AI initiatives, improving organizational efficiency.

See Full Bio