Microsoft Price Lists and Discount Levels
Introduction – Why Price Lists Matter
When it comes to Microsoft enterprise licensing, pricing isn’t a fixed sticker—it’s a moving target. Microsoft uses tiered price levels (Levels A–D) and negotiated discounts to adjust what each customer pays.
This structure can be complex by design, which often benefits Microsoft. However, understanding how these price lists work gives you leverage. If you know the game, you can play it to your advantage.
In this guide, we demystify Microsoft’s pricing tiers and show how to use that knowledge to secure better terms in your agreements. The goal: turn Microsoft’s pricing model from a source of confusion into a negotiation weapon for you.
Read our complete guide to Microsoft Pricing & Discounts.
Volume Licensing Price Levels (A–D)
One of Microsoft’s key pricing mechanisms in enterprise deals is the volume price level. Under programs like the Enterprise Agreement (EA), customers are categorized into Levels A, B, C, or D based on volume (such as number of users or licenses).
Think of it as buying in bulk – the more you commit to, the better your price per unit. Level A is the entry tier (smallest volume, highest unit price), and Level D is the highest tier (very large volume, lowest unit price).
Here are the typical thresholds and how discounts scale with volume:
| Price Level | Typical Volume Threshold | Discount Expectation |
|---|---|---|
| Level A | ~250–2,399 seats (baseline) | Minimal discount (pays list price) |
| Level B | ~2,400–5,999 seats | Modest discount (a few % off list) |
| Level C | ~6,000–14,999 seats | Significant discount (deeper % off) |
| Level D | 15,000+ seats | Deepest discount (lowest unit costs) |
The higher the level, the steeper the built-in discount. For example, a Level D organization might automatically pay around 10–15% less per license than a Level A organization for the same product.
Bigger commitments unlock better pricing by default. However, these tiers are just the starting point.
In negotiations, you can push for even better pricing than the standard level discounts. (Important note: Microsoft is evolving its pricing—by late 2025, it plans to charge a single “Level A” price for many cloud services, removing automatic volume discounts. On-premises software pricing and other programs still use these tiers, so understanding them remains crucial.)
List Price vs. Your Price
Microsoft’s “list price” is the official sticker price for a product or service—essentially the MSRP. In reality, few enterprise customers actually pay list price.
Your actual price (“street price” or negotiated price) will almost always be lower after standard discounts and negotiations. Microsoft’s list serves as a theoretical baseline; the real question is how far below that baseline you can get.
When you receive a quote or a renewal proposal, it’s vital to distinguish between the list price and your price.
For instance, if the list price for a product is $100, a standard volume discount might bring it to $94, and a good negotiation could bring it down to $85. That gap between $100 and $85 is where your savings lie—the discount margin is the real game.
Always ask your Microsoft partner or reseller for the current price list relevant to your agreement. These price lists (often available through partners or Microsoft’s portals) show the official list prices for all products in your region/program.
By obtaining the list pricing, you can calculate exactly what percentage discount is reflected in your offer. It’s your right to know the list price and your price, so you can confidently say, “We’re getting a 12% discount off list—surely we can do better given our volume.”
How to access price lists: Microsoft doesn’t broadcast its enterprise price lists publicly on websites. However, you can request the price list from your reseller or Microsoft account rep.
Partners have access to monthly updated pricing catalogs for all Microsoft SKUs. Don’t be afraid to say, “Please provide the official price list for these products.” Having that data equips you to spot if you’re being offered only a token discount or a truly competitive deal.
If you dont benchmark you are negotiating blind, Benchmarking Microsoft Licensing Costs: Are You Overpaying?.
EA Customer Price Sheets (CPS)
In an Enterprise Agreement, all your negotiated prices are documented in a Customer Price Sheet (CPS). This spreadsheet-like document is critical – it itemizes every product SKU you’re licensing and the exact unit price you agreed to pay.
Essentially, it’s the receipt of your deal, showing the “your price” for each item, which often already includes any volume level discount plus additional negotiated discounts.
Reviewing your CPS is especially important before a renewal or new purchase. It lets you see what you’re paying now versus the list price at the time you signed. Smart customers use the CPS to calculate their effective discount.
For example, if Office 365 E3 is listed on your CPS at $28 per user/month and the official list price was $32, you know you had roughly a 12.5% discount.
Armed with that knowledge, you can approach a renewal saying, “We’re currently at 12.5% off – we’ll need to do better this time, especially if our volumes are increasing.”
Always request your CPS from your partner or Microsoft if you don’t have it on file. It should be provided when you sign an EA, but many procurement teams file it away and forget it.
Pull it out well ahead of renewal. It’s your benchmark for negotiations – and a means to verify that any new quote isn’t trying to creep your prices up. Also, check that every product you use is listed.
If you plan to add a new product (say, a new Azure service or a Dynamics module), consider adding it to your agreement before certain pricing changes (Microsoft’s recent pricing updates mean anything not on the CPS could default to full list price later).
In short, the CPS is your transparency tool – use it to hold Microsoft to the deals you negotiated and to spotlight where you deserve a better deal next time.
How Discounts Are Applied
It’s important to understand how Microsoft applies discounts in practice. Discounts can be applied on a line-item basis (specific to each product) or as an overall discount on a deal. In many enterprise deals, it’s not as simple as “X% off everything.”
Microsoft may offer heavier discounts on some products and lighter discounts on others, depending on its strategic objectives. For example, they might be willing to deeply discount a newer product to drive adoption, but give a smaller discount on a high-demand product like Office 365.
The end result is your blended discount across the whole agreement.
Let’s break down an illustrative example for clarity. Imagine the list price of Office 365 E3 is $32 per user/month (for easy math).
Here’s how it could play out:
- List Price (Level A): $32 per user/month (no discount, baseline).
- Automatic Level Discount (Level D): If you’re a Level D customer, you might automatically get around 10% off. That brings the price to roughly $29 per user/month.
- Negotiated Price: With savvy negotiation, you push further and secure an additional discount, landing at, say, $27 per user/month.
In this scenario, your total discount from list is about 15.6% (going from $32 to $27).
The Level D status gave you the first cut (down to $29), and negotiation gave you the rest (down to $27). It’s important to note that Microsoft often doesn’t frame it as two separate discounts – they’ll just present the final price of $27. But behind the scenes, your large volume earned a built-in reduction, and your negotiation skills earned another.
Do these discounts stack? Essentially, yes – volume levels set the floor, and you negotiate from that floor down. A common mistake is to assume the volume discount is the best you can do (“We’re Level D, so we’re already golden”).
In reality, the real savings come when you negotiate below the standard level price. Microsoft reps might not volunteer that there’s room beyond the standard tiers, but there often is, especially if you’re considering competitive alternatives or willing to sign a longer-term deal.
Also, pay attention to which products get what discount. Your effective discount might be 15% on one product and 5% on another, depending on Microsoft’s pricing strategy. Always break down your quote by line item.
Ask questions like, “What discount are we getting on Product X versus Product Y?” If one line-item discount is lacking, you can target that in negotiations (“We need at least 15% off on our Office 365, not just 5%.”).
Microsoft’s pricing teams have flexibility; the discount doesn’t always apply evenly across the board unless you push for it.
Regional Price Differences
Microsoft’s price lists vary by geography. A Microsoft 365 license might have a different list price in Europe, the U.S., or Asia, partly due to currency exchange rates and market conditions.
Microsoft periodically does “global price alignment” adjustments.
For example, if the Euro or GBP has shifted significantly against the USD, Microsoft may raise or lower local prices so that the cost in EUR or GBP aligns more closely with U.S. pricing. What does this mean for a global enterprise? Where and how you buy can impact price.
If your organization operates in multiple regions, you may notice that you have historically paid less per license in one region than in another.
Microsoft’s aim (from their perspective) is to eliminate these arbitrage opportunities by harmonizing prices.
However, until they do (and even afterward for on-premises licenses), savvy customers consider centralizing purchases or standardizing agreements to avoid regional price discrepancies.
For instance, some enterprises consolidate their purchasing through a single global EA based in a primary region.
By doing so, they ensure all locations benefit from the highest volume tier and a unified discount structure, rather than fragmenting into smaller deals that each get a weaker discount.
When negotiating, be aware of any regional pricing quirks.
Suppose Microsoft announces a 10% price increase in your country due to currency changes, and you have an EA renewal coming.
In that case, that’s a signal to negotiate aggressively – perhaps pushing for price protection or using another region’s pricing as a benchmark (“Our UK subsidiary sees a lower price for the same service; we need alignment across regions”).
Microsoft won’t normally let you simply buy licenses in a cheaper country for use elsewhere (there are rules against that), but you can negotiate with the knowledge of those differences.
Also, if you purchase through a partner, ensure they’re giving you the correct regional pricing and not adding unnecessary margins.
Strategy tip: If you buy globally, coordinate your strategy globally.
Microsoft often gives its best concessions to companies that approach licensing as one big unified customer. Use your combined global headcount or spend to reach a higher price level and insist on consistent pricing.
Don’t accept a situation where, say, your European offices are stuck at Level B pricing while the U.S. is at Level C. Consolidate and treat your enterprise as one customer to maximize volume benefits.
True-Up Price Locks
One huge benefit of an Enterprise Agreement is price protection for true-ups. In an EA, you typically commit to an initial quantity of licenses for a 3-year term, but you have flexibility to add more licenses as your needs grow (known as “true-ups” each year).
The crucial part: the unit price for those additions is locked at what you negotiated on day one.
In other words, if you negotiated a $27/unit price for a product, any additional licenses you add during the EA term cost exactly $27 each, regardless of what Microsoft’s list price does later. This is an advantage – it shields you from price hikes and preserves your discount level even as you grow.
Why is this so important? Imagine you negotiated a 15% discount and locked a price of $27 for Office 365 E3.
If a year later Microsoft’s list price jumps or they eliminate volume discounts for new purchases (which, as noted, is happening for online services after Nov 2025), your additions are still $27. You’re not forced to pay the new higher list or drop back to Level A pricing for those new licenses.
True-up price locks are your insurance policy against both Microsoft’s annual price increases and changes in your own volume. Every additional employee you onboard or new product you deploy during the term comes at the agreed rate.
However, this benefit only helps if you negotiated a good price to begin with. If you accept a mediocre deal up front, you’ll be locking in that mediocre price. That’s why negotiating upfront is critical. You won’t get a chance to renegotiate unit prices until the EA term ends, no matter how many licenses you add mid-term.
Also, be sure that your contract explicitly states the pricing for true-ups (it usually does in the CPS “Future Pricing” section). Verify that any additional licenses are offered at the same price or with the same discount percentage as the initial ones.
If there’s any ambiguity, clarify it. The last thing you want is a surprise where Microsoft argues a new purchase isn’t covered by the old price. Generally, though, EAs are straightforward: price per unit is fixed for the term for the products you initially licensed.
In summary, leverage the true-up policy by negotiating hard on the initial price.
Then you can confidently grow your usage, knowing your spend per unit is capped. If you anticipate needing a lot more licenses, you might even negotiate a cap or volume allowance (“we can add up to 20% more users at this price”).
This locks in your cost and avoids a budget shock later. Microsoft’s not offering this out of kindness—it’s part of the EA value, so make it count in your favor.
Negotiation Insight: Using Levels as Leverage
Here’s a strategic secret: Don’t let Microsoft’s tiered model box you in – instead, make it a bargaining chip.
A common scenario is being just shy of the next price level. Suppose you have 5,800 users, which puts you at Level B, and Level C (with better discounts) starts at 6,000. Microsoft might suggest you buy 200 extra licenses you don’t need to reach Level C. Instead of blindly overbuying, turn that around in negotiation.
For example: “We’re very close to Level C. If you give us Level C pricing now, we’re prepared to purchase additional products or expand deployment to more teams.”
In essence, ask for the better pricing tier without the unnecessary purchases, by offering something else of value (longer commitment, broader product adoption, etc.). You’d be surprised how often Microsoft will relent on a threshold if it means keeping your business happy and growing.
Another insight: Microsoft’s sales reps are under pressure to maximize revenue, but they also fear losing deals.
If you’re a Level B customer threatening to go to a competitor or even to shift some spend to a different Microsoft licensing program (like CSP or a smaller agreement), that can scare Microsoft enough to extend higher-tier discounts to keep you in the EA fold.
Use that. Say, “We know we’re not at 15,000 seats, but if you want all our business in this EA, we need you to treat us like a Level D in terms of pricing.” It helps to back this up with data (perhaps you know a similarly sized company that got better pricing – mention it without names).
Also, remember that negotiation is not just about volume, but also about timing and willingness to walk away. If your renewal is nearing and Microsoft knows you’re considering alternatives, they might offer a special discount beyond standard tiers (sometimes called an “exception discount”).
These aren’t advertised, but they exist. For instance, they might add an extra 5% off to match a competitor’s offer or to close the deal this quarter. Such concessions often aren’t permanent (they might apply only for this renewal term), but they’re worth pursuing.
In summary, never view Microsoft’s price levels as rigid hurdles. They are tools for Microsoft’s pricing strategy, but you can flip them into advantages for you.
Every time Microsoft says, “That’s the price for your level,” hear it as, “a challenge to overcome.” Counter with: “What would it take for you to give us the next level’s pricing?” and have a plan: maybe a slightly larger commitment or a multi-year extension. Approach tiers with creativity: use thresholds as leverage, not as limits.
✅ Checklist – Price Level Negotiation Essentials
- ✓ Know your current level and the next threshold: Be crystal clear on whether you are Level A, B, C, or D, and how far you are from the next tier. This context is your starting point for any negotiation conversation.
- ✓ Always obtain your Customer Price Sheet (CPS): Verify every unit cost on your CPS. It’s your proof of what you’re paying and your benchmark for discounts. Never go into a renewal blind; review the CPS to catch any sneaky price upticks.
- ✓ Model the impact of each level: Before committing to any big purchase, calculate your costs if you were at the next level up. This analysis shows how much you’d save and can justify why Microsoft should move you to a better band without an enormous order.
- ✓ Lock in true-up prices: Ensure your agreement explicitly locks prices for any added licenses (true-ups). If it’s not clearly stated, negotiate to include that. Preserving the same unit cost for additions protects you against future price hikes.
- ✓ Leverage volume, don’t overspend: Use the existence of volume levels as a bargaining tool (“We’re nearly Level D, give us Level D pricing!”) but resist the urge to purchase software you don’t need just to hit a number. Microsoft’s tiers should serve your interests, not dictate your buying to your detriment.
FAQs
How do I find out my current price level?
Your price level (A, B, C, or D) is determined by your volume (such as user count or points) in your Microsoft agreement. You can find it in your contract paperwork or Customer Price Sheet. If it’s not obvious, ask your Microsoft account rep or reseller directly: they can confirm which price level your organization is on. Typically, the EA or volume license agreement will state your level based on the initial purchase quantity.
Are discounts the same across all Microsoft products?
No. The percentage discount can vary by product line. Microsoft might give a bigger break on certain software or services and less on others. The Level A–D structure applies broadly (higher volume generally means lower prices across the board), but the exact discount isn’t uniform. For example, you might see a 15% drop from list on Office 365, but maybe only 5–10% on some premium Azure services, even at the same level. Always review each item in your quote; some products may have special pricing or promotions, while others have tight margins.
Do regional price shifts affect locked EA terms?
If you have an EA with price locks, regional price changes won’t affect you until renewal. Microsoft may adjust public list prices in certain regions due to exchange rates or inflation, but your contractual price is fixed during the EA term. For instance, if Microsoft raises prices in Europe by 10% mid-term, your EA pricing stays the same if it’s already set in the CPS. However, at renewal time, those regional adjustments will be reflected in the new list price so that you could see a jump then. The key is that during the term, your negotiated prices are insulated from Microsoft’s external price changes.
Can small companies reach higher levels?
By definition, smaller organizations won’t have the volume to hit Levels B, C, or D on their own. Price levels are tied to size – so a company with 200 seats will be Level A and can’t “qualify” for Level B pricing automatically. That said, small companies can still negotiate discounts; they just come through special terms or partner deals rather than volume tiers. Some smaller businesses join consortia or use Cloud Solution Provider (CSP) programs where the pricing is flat (and often equivalent to a decent volume discount). But generally, higher-level discounts are intended for large enterprises. If you’re a small firm, focus on negotiating based on strategic value or growth potential rather than volume. For example, suppose you’re a startup that’s rapidly growing or a small company in a strategically important industry. In that case, Microsoft might agree to non-standard discounts (effectively treating you like a bigger fish) to earn your long-term loyalty.
What happens if I drop below a threshold?
During an EA term, nothing changes immediately if your user count drops – you’ve committed to a certain number of licenses, and you usually can’t reduce that until renewal (there’s typically no “true-down” within term). However, at renewal, Microsoft will price your new agreement at whatever level your current volume justifies. So if you originally had 2,500 users (Level B) and now you only need 1,800, you’d fall into the Level A range for a new EA, which means higher prices per unit if you don’t negotiate otherwise. It’s a bit of a gotcha: falling below a tier can lose you the volume discount in the future. To avoid a cost spike, you should proactively discuss this with Microsoft. Sometimes you can negotiate to retain a discount band despite lower volume (especially if the reduction is temporary or you have other mitigating factors). However, be prepared: if your organization significantly downsizes or reduces consumption, Microsoft will likely adjust your pricing to match the lower volume. The best approach is to renegotiate terms to soften the blow – for example, perhaps commit to a longer term or add another product to get a concession that offsets the level drop. Always go into a renewal with your eyes open: if your headcount or usage has shrunk, have a plan to address the pricing impact.
Five Expert Recommendations
- Never negotiate without knowing your current level and spend: Walk into any Microsoft deal discussion armed with data. Know your price level, how far you are from the next tier, and exactly what you’re spending on each product. This knowledge prevents Microsoft from pulling the wool over your eyes with statements like “you’re getting a great deal for your size” – you’ll have the facts to challenge that.
- Benchmark your CPS prices against list and peers: Take the unit prices on your Customer Price Sheet and compare them to Microsoft’s list prices (and if possible, to what similar companies pay). If your CPS shows you’re paying $50 for something with a $60 list, that’s ~17% off. Is that good in your industry and for your volume? If peers are paying $45, you have room to push harder. Use this benchmark to set target discounts for your renewal.
- Use thresholds as a bargaining tool, not a shopping quota: Don’t let the tail wag the dog. Instead of purchasing unnecessary licenses to hit a tier, use the idea of that tier to negotiate. Tell Microsoft what they want to hear (“We could grow to Level C with the right deal”) without actually signing up for shelfware. It keeps the focus on discounting rather than upselling.
- Push for regional alignment if you buy globally: If you’re a global enterprise, don’t settle for paying higher prices in one region just because of local list differences. During negotiations, highlight any discrepancies and encourage Microsoft to standardize pricing across regions. You might phrase it as “We need a globally consistent price so we’re not penalized for where our users are.” This not only saves money but also simplifies your internal budgeting.
- Get all commitments in writing – especially price locks: Verbal assurances from reps mean nothing if they’re not in the contract. Ensure that your EA documents include all the negotiated goodies: fixed pricing for true-ups, caps on increases, special discounts, etc. If you negotiated that Azure will have a 5% cap on price increases in years 2–3, make sure the EA paperwork reflects it. Having every promise in writing is the only way to enforce it later.
By following these practices and insights, you’ll cut through Microsoft’s pricing complexity and secure more buyer-friendly deals. Remember, knowledge and preparation are your biggest allies in turning Microsoft’s pricing structure into an opportunity rather than an obstacle.
With the right approach, you can confidently negotiate from a position of strength and ensure you’re getting the best value for your organization.
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