Microsoft is set to hike its Power BI prices — will buyers jump ship or just take the hit?

Microsoft Power BI users will soon face hefty price increases of anywhere from 25% to 40%.

While the Redmond, Washington-based tech giant has attempted to justify these larger price tags by saying they are reflective of its ongoing investment in innovation, analysts call it a strategic move — and Microsoft isn’t the only BI vendor charging more.

“This is not just Microsoft — I hear from many clients who are due for renewals that their BI vendors are increasing prices,” Forrester VP and principal analyst Boris Evelson told CIO. “In some cases, very significantly.”

Driving users to Microsoft 365, Fabric

Beginning April 1, Power BI Pro will increase from $10 to $14 per user per month (representing a 40% increase), while the price of Power BI Premium will grow from $20 to $24 per user per month (a 25% increase).

Analysts point out that it seems to be a tactical move by Microsoft to reduce the pricing gap between Microsoft 365 (M365) edition 3 (E3, which does not come with Power BI Pro) and M365 E5 (which does).

E5 costs $54.75 user/month (paid yearly), while E3 costs $33.75 user/month (paid yearly). Info-Tech Research Group noted that most customers need a 30% to 35% discount on the E5 license to match the renewal pricing for M365 E3.

“Although Microsoft justifies the hike as reflective of their continued innovation, the underlying strategy appears aimed at driving customers toward their all-in and most robust suite,” Adam Mansfield, UpperEdge commercial advisory practice leader, told CIO.

If BI tools get more expensive, Microsoft can pitch E5 as a more ‘economical’ path forward, he noted. Still, customers need to make sure they have negotiated the right price and have price protections in place for Microsoft 365 E5 if they make the move.

Making the shift “represents a challenge, but also an opportunity for Microsoft customers if handled appropriately,” he said.

Scott Bickley, advisory fellow at Info-Tech Research Group, sees it as Microsoft pushing clients toward its new Fabric integrated data management platform, which features Power BI and a slew of other capabilities including real-time intelligence, data science, data warehouses, and data factories.

He noted that most Power BI estates of any meaningful size will see cost efficiencies in migrating to Fabric F64 (Fabric with 64TB of storage) with a three year commitment, which allows unlimited report consumption by all users. “This is a safe bet for Microsoft, as there are no real alternatives in the market offering feature parity at the same price point, even after the price increase,” he said.

He did point out that Power BI customers with renewals prior to April 2025 have the option to lock in their current pricing until their next anniversary date.

A sign of the times — or a time to consider alternatives?

Evelson reported that he is “inundated” with calls from clients concerned that their contracts are up for renewal and their BI vendors are jacking up their prices (by 10X or more). While Microsoft is doing the same, Power BI remains the least expensive BI tool on the market; also, he pointed out, the Pro license has been $10 per user per month for a long time, so this price increase was coming.

“I do not see this as anything significant, other than, yes, alas, buyers will have to pay up,” he said, pointing out that migrating to another BI platform is a “costly, complex endeavor.”

On the other hand, some note that Microsoft’s plan to drive more Microsoft 365 E5 adoption, and the associated accelerated average revenue per unit (ARPU) that comes with it, could backfire.

Customers and their leadership teams could be compelled to closely examine current Power BI use, identify inefficiencies, and assess whether the product’s value justifies the increased cost, Mansfield noted.

“While some may make the move to the Microsoft 365 E5 bundle, others might use this as a pivotal moment to explore alternative analytics platforms,” he said. For instance, they could take advantage of competitive pressure to negotiate better terms with Power BI competitors such as Salesforce Tableau.

He advised buyers to approach any potential shift to a new platform “holistically,” by prioritizing analytics tools closely aligned with broader business objectives. It’s also important to negotiate flexible licensing terms that include clearly defined usage metrics, renewal-term price protections, and contractual safeguards against future cost increases.

For smaller businesses, Bickley noted, “the price hike is a blow,” and it could prompt alternative vendors to adjust to the lower end of the market and grab that market share. However, he said, “this is market share Microsoft is likely okay with losing.”

However, he emphasized, the increase doesn’t come without benefits: Power BI has had more than 1,500 enhancements over the years. “The increase should be viewed as capturing value add already funded by Microsoft’s R&D expenditures,” he said.