Microsoft Updates Maintenance Pricing for Its On‑Premise ERP Systems (October 2024): Everything You Need to Know

Microsoft has announced changes to the maintenance pricing for Dynamics NAV/BC On‑Premise that will take effect between October 1 and 3, 2024. These adjustments are part of a strategy to encourage cloud migration and ensure the long‑term sustainability of business systems.

Increase in the Dynamics NAV/BC On‑Premise Enhancement Plan (maintenance pricing)

Starting October 3, 2024, the annual fees for the Enhancement Plan (EP) will increase by 1 percentage point for renewals and new sales. This means that the fee for a 1‑year EP will rise from 18% to 19% of the Protected List Price (PLP).

What does this mean for NAV/BC On‑Premise customers?

• Renewals and New Sales: If you are a Dynamics On‑Premise customer with an active Enhancement Plan or are considering purchasing one, you should be aware of this change. The 1% increase will affect your annual costs.
• Rate Preservation for 2‑ or 3‑Year Plans: Customers who choose two‑ or three‑year plans (annual or prepaid) will keep their original rate for the entire duration of the plan. The rate is determined by the date the EP quote is created, not the order date.

Practical Example

Suppose a customer requests a new three‑year annual EP plan through a quote created in August 2024. In this case, they would receive the 18% rate for the entire duration of the plan. If the same customer requested the same plan using a quote generated from October 2024 onward, the rate would be 19%.

Regional Conversion Factors for Dynamics On‑Premises

Local prices may vary for most non‑US regions due to conversion factors used to translate base USD pricing into local currency.

For example, for NAV and Business Central in EUR:

• Subscription (NAV and BC): +12%
• NAV perpetual: +19%
• BC On‑Premise: +7%

These percentages are rounded estimates of the variation in the estimated retail price resulting from conversion factor adjustments. Contact us for the final pricing tables for greater accuracy.

On‑Azure Discount

The discount for Dynamics subscriptions running On‑Azure—already removed for new customers—is also being phased out for existing customers. Starting October 1, 2024, On‑Azure discounts will be reduced from 10% to 5%.

Changes to Volume Discounts

Two levels of volume discounts are available:

• 15% discount for 50–249 points purchased in a single order
• 29% discount for 250 points or more purchased in a single order

Points are calculated as follows: 1 point = 1 full user or 5 team members (For example, if a customer buys 1 full user and 10 team members, that equals 3 points.)

What are On‑Premise Enhancement Plan (EP) maintenance prices?

The  Enhancement Plan (EP) is an annual maintenance program for your Microsoft Dynamics On‑Premise solution. This plan ensures that your On‑Premise ERP system remains up to date and operating at peak performance.

When we talk about On-Premise, we refer to Dynamics software solutions running in local environments—meaning physical servers within a company’s own infrastructure.

The EP gives you access to updates and hotfixes, including product improvements as well as legal and tax‑related changes. This ensures that your solution is always up to date with the latest features and compliant with current regulations.

In addition, the EP protects you from price fluctuations, providing greater predictability for your renewal budget year after year.

Finally, if you decide to transition to a new model, product, or edition of Microsoft Dynamics, the EP safeguards your original investment.

In summary, the EP is a way to ensure that your Microsoft Dynamics On‑Premise solution is always performing at its best, and maximizing system efficiency.

Why this change in the On‑Premise Enhancement Plan (EP) maintenance pricing?

Microsoft is committed to innovation and the security of its products. Migrating to the cloud— specifically to Dynamics 365 Business Central—offers significant advantages in terms of stability, security, and automatic updates. Technological obsolescence and the risks of maintaining unsupported systems are challenges that must be addressed.

What should I do in response to these changes?

1. Evaluate your situation: If you are using Dynamics On‑Premises, analyze how this increase in fees will affect you. Consider the option of migrating to Business Central in the cloud to take advantage of its benefits.
2. Get in touch with us: Speak with us to receive personalized guidance on cloud migration. Our team of experts will be happy to help you understand the pricing changes and plan a successful transition to Business Central in the cloud. 
3. Explore Business Central: Look into the advantages of Business Central, such as its cutting‑edge technology, all‑in‑one solution, and automatic updates. Request a FREE 30‑day DEMO from us. 

How will the change in On‑Premise Enhancement Plan (EP) maintenance pricing affect my company?

The increase in Enhancement Plan (EP) fees for Dynamics On‑Premise can have significant implications for your business.

Let me explain how this could affect you:

• Annual Costs:

1. 1. • If you currently have an active Enhancement Plan or are considering purchasing one, you should be aware of this change. The 1% increase in annual fees means you will need to allocate additional financial resources to maintain your Dynamics On‑Premise system.

• Financial Planning:

1. 1. • It is important to review your budget and assess how this increase will impact your operating expenses. Consider whether absorbing the additional cost is sustainable for your company..

• Alternatives:

1. 1. • Migrating to Business Central in the cloud could be a viable solution. Here are some considerations:
        • Stability and Security: Business Central offers greater stability and security compared to an on‑premise solution.
        • Automatic Updates: The SaaS model ensures optimal performance through automatic updates.
        • Technological Obsolescence: Business Central stands out for its cutting‑edge technology and continuous enhancements.

• Concerns About Data Integrity:

• • Maintaining unsupported systems can expose your company to security risks and potential data loss. Consider whether it is time to migrate to a more modern and secure solution.
    • See “Important information for Navision users – The risks of being unprotected.”

It is crucial to evaluate how this increase will affect your operations and make informed decisions. The cloud offers significant advantages, and migration should be considered as part of your business strategy.

In summary, the price update is a clear signal that the cloud is the path forward.. 

Do not risk the integrity of your data or the efficiency of your business. It is time to consider migrating to Dynamics 365 Business Central in the cloud.