Your renewal outlives the remedy

The remedy the UK is preparing will arrive after the agreement it would have repriced. This reaches you if a Microsoft enterprise agreement is due for renewal before 13 February 2027, or if you justify Azure consumption on licence rights that stop at the Azure boundary. Existing Microsoft 365 licences cannot be brought to a non-Azure Listed Provider, except onto certain plans in that provider's virtual desktop offering, with dedicated hardware requirements and add-on Virtual Desktop Access licence fees, and a Listed Provider cannot sell Microsoft 365 licences through its own agreement at all. The CMA records both in a table of concerns raised with it. The same licence keeps its rights on Azure and loses some of them on a rival cloud, so the clause that prices the estate is the clause that prices the exit. What a buyer decides is the term.

01The price of leaving is written in the licence, not in the renewal

Three documents carry this and they do not carry equal weight. The CMA's cloud market investigation concluded on 31 July 2025 that Microsoft's licensing practices in relation to certain business software limit customer choice and reduce competition in cloud services. Its roadmap of 16 October 2026 restates the follow-up in the regulator's own words: “The evidence we have received since the Cloud MI shows that Microsoft has not altered its licensing practices in respect of that software.” What follows is a table of “Concerns we have heard over the course of our SMS investigation to date”, and a concern carries no obligation. A buyer negotiating a renewal before 13 February 2027 holds a concluded finding about the practices, a dated statement that they have not changed, and nothing enforceable in the United Kingdom.

One footnote in that table is the sharpest line in the pack. It defines the rivals Microsoft names as “Listed Providers” and then adds: “although the Azure Hybrid Benefit effectively means that Microsoft is not subject to the same restrictions.” The restriction binds every Listed Provider and does not bind the one that owns Azure. That is what a lock looks like when it is drafted as a licence term rather than a contract clause: it does not prohibit exit, it makes exit a different product. The proposed decision is explicit that designation “does not find or assume wrongdoing”, and the footnote is a record of how the terms work, not an allegation that they were breached.

02Revenue per seat is doing the work, and the seat is the thing that cannot move

Microsoft decomposes its own growth in two sentences. In the Form 10-Q for the quarter ended 30 September 2026: “Microsoft 365 commercial cloud revenue increased 17% driven by higher revenue per user, reflecting continued upsell to premium seat offerings, including Microsoft 365 Copilot, E5, and E7, as well as increased consumption of usage-based services, primarily in GitHub Copilot. Microsoft 365 commercial seats grew 5%.” Fiscal 2026 reads the same way, at 18% against 7%, with revenue per user growth “driven by Microsoft 365 Copilot and Microsoft 365 E5”.

The gap between those two rates is where the renewal uplift comes from. A supplier adding 5% more seats and about 11% more revenue per seat grows the account 17% without the customer hiring anyone, and the attach that produces it, Copilot or E5 or E7, arrives inside the same licence that cannot move. Implied revenue per seat is Mosaic Singularity analysis, November 2026, applied to the issuer's two growth rates, not a figure Microsoft publishes. The CMA has published what the arrangement earns: a provisional view that Microsoft “is earning profits substantially above its cost of capital”, and an estimate that the UK Business Software Ecosystem “has generated a return on capital employed (ROCE) of over 70% in financial year 2024/25 compared to an estimated weighted average cost of capital (WACC) of 10%-15%, equating to profits in excess of the WACC of £[4-5] billion.” Those are the regulator's estimates on UK data and the excess is printed as a redacted range, so they are a benchmark and not a finding. A benchmark is what a renewal otherwise lacks, where the alternatives are the supplier's discount schedule and a rival's list price.

03Ninety-two days to a decision, and about 840 days of contracted revenue

Responses close at 17:00 UK time on 13 November 2026. The investigation must be completed by 13 February 2027, which is 92 days after the response deadline. Microsoft's book is longer than that: $677 billion of commercial remaining performance obligations “with a weighted average duration of approximately 2.3 years”, of which about 30% is recognised within 12 months. 2.3 years is about 840 days. That is a weighted average duration across the commercial remaining performance obligation, not a term any single customer signed, and it is longer than the 92 days the investigation has left to run.

Designation is a gateway and not a remedy. The roadmap says of itself that it “does not set out the evidence or reach a view on interventions that should be proposed (or put in place)”, and that any potential conduct requirement or pro-competitive intervention “will be subject to assessment and public consultation” before it is imposed. Its four focus areas, cloud services, AI features within productivity software, communication and collaboration, and security software, are areas for further evidence. A final decision on 13 February 2027 therefore opens a further process, and an agreement signed before it is signed on the terms the roadmap sets out on 16 October 2026.

The one settlement already in force elsewhere does not travel. The roadmap records that the European Commission “accepted a package of commitments combining unbundling, interoperability and transparency measures in 2025” on Teams, and then that “These commitments do not currently apply formally in the UK.” A United Kingdom buyer holds no equivalent term, so the protection a European affiliate can point to is not available to the seat negotiating here.

04Three seats, four dates, and what each one signs

05The questions the board puts to the renewal team

• Which of our licences appear in the CMA's Table 1, and what would it cost to run each of them on a named non-Azure provider the month after the term ends?
• If revenue per seat is rising about 11% and seats 5%, what has our own per-seat price done over three years, and can we produce that number from our invoices?
• Does the enterprise agreement name the Azure Hybrid Benefit anywhere, and what happens to it if we move a workload off Azure mid-term?
• What have we filed with the CMA, and if the answer is nothing, who decided that and against which clause in our own policy?
• If a conduct requirement arrives in 2028, what in this agreement lets us reopen the price before 2030?

What reaches the board is one decision, taken before the current agreement's renewal date and in no case later than 13 February 2027: the renewal term and the mobility term together, either a term that runs past the CMA's final decision on the terms the roadmap records, or a bridge to that decision with the estate repriced once mobility is known.

06What to watch, and the date it lands

The reading is that the remedy cannot catch this renewal, and two events would show it wrong. If the CMA's update after the final decision names licence mobility as an area for intervention with a timetable for a conduct requirement, the gap closes and the calendar argument goes with it. If Microsoft alters portability before 13 February 2027, the same happens. Three dates will show which way it went. The first is 13 November 2026, when the consultation closes and the responses become part of the record. The second is 13 February 2027, when the investigation must be complete and the CMA has said it will provide an update on its areas of focus. The third is Microsoft's Form 10-Q for the quarter ending 31 December 2026, which restates the revenue growth and seat growth pair and will show whether the gap has opened again or closed.

• CMA, Proposed decision on designating Microsoft with Strategic Market Status, 16 October 2026
• CMA, Roadmap of possible interventions, including Table 1 on Microsoft's licensing practices, 16 October 2026
• CMA, Appendix D, profitability analysis, 16 October 2026
• Microsoft, Form 10-K for the fiscal year ended 30 June 2026, filed 28 October 2026
• Microsoft, Form 10-Q for the quarter ended 30 September 2026, filed 28 October 2026