Microsoft to raise
enterprise prices in UK after pound plunges
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[October 24, 2016]
By Kate Holton
LONDON
(Reuters) - Microsoft plans to increase prices for some enterprise
services by up to 22 percent in Britain following the plunge in the
pound, likely hitting thousands of companies and government departments
who rely on its cloud and software products.
Microsoft said it would increase prices for its enterprise software by
13 percent and for its cloud services by 22 percent from Jan. 1 next
year, becoming the latest tech company to raise fees in the wake of the
vote to leave the European Union.
Britain's shock vote on June 23 triggered the biggest one-day fall in
sterling against the dollar and the pound is now down 18 percent against
the U.S. currency, prompting computer makers such as Apple <AAPL.O>,
Dell and others to increase prices in Britain.
The Bank of England has said it expects inflation to rise steadily over
the next couple of years, overshooting its target of 2 percent and
eroding household living standards.
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The issue hit the headlines this month when Britain's biggest
supermarket, Tesco, clashed with supplier Unilever, briefly pulling
popular goods such as the spread Marmite from its website.
Nestle, the Swiss maker of Kit Kat bars and Nescafe coffee, has said it
is also looking at all options to deal with the steep decline in the
British currency.
Long known for its Windows software, Microsoft has turned its focus to
mobile and cloud computing in recent years, storing, managing and
processing data for thousands of companies and public sector providers
across a range of sectors.
It said it would not change the prices on consumer services and would
also not change prices for existing orders under price protection deals
during the term of that agreement.
"We periodically assess the impact of local pricing of our products and
services to ensure there is reasonable alignment across the region and
this change is an outcome of this assessment," Microsoft said on its
blog.
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![](../images/102416pics/busine23.jpg)
A Microsoft logo is seen next to a cloud the day after Microsoft
Corp's $26.2 billion purchase of LinkedIn Corp, in Los Angeles,
California, U.S. June 14, 2016. REUTERS/Lucy Nicholson
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It said the changes were similar to adjustments it had announced to
pricing in Norwegian krone and Swiss franc in April.
A spokeswoman for the British Cabinet Office, which supports the overall
running of government including the management of major contracts, said
it worked to secure the best prices for taxpayers.
"Where we are made aware of proposed price changes for a specific
supplier we will work closely with that supplier to identify ways to
mitigate any increases in price," the spokeswoman said.
(Reporting by Kate Holton in London and Sangameswaran S in Bengaluru;
editing by Sandra Maler and Jason Neely)
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