Microsoft will cut the price of Windows 365 subscriptions for small and mid-sized businesses by 20% next month, though analysts expect little impact on uptake of the Desktop-as-a-Service (DaaS) platform. 

The price change for Windows 365 Business takes effect May 1, 2026 for new subscriptions; existing subscribers will receive updated pricing at renewal, Microsoft explained on its Partner Center page.

The company first introduced the lower rate as a promotional offer last October and is now making that reduction permanent.

At the same time, Microsoft will also introduce a new “on-demand start experience” that will result in longer time to start up Cloud PC virtual desktops when they’ve been disconnected for more than an hour.

“The impact on user experience will likely be minimal, spare a slightly longer startup time on the first connection after hibernation,” said Gabe Knuth, principal analyst at Omdia.

The Windows 365 price change comes as PC prices are set to rise this year due to global memory chip shortages.

Even so, Jack Gold, principal analyst at J. Gold Associates, doesn’t expect the Windows 365 price cut to result in a significant boost in adoption among small to mid-sized businesses.

“I do expect that the price decrease is an incentive move to get companies to move to Windows 365, but I’m not convinced it will make that much difference,” Gold said. “TCO [total cost of ownership] is a major component of enterprise concerns about deploying PCs — in that sense this helps. But whether or not it’s enough to move adoption rates remains to be seen.”  

Windows 365 currently represents a “small minority of enterprise PC installations,” he said. 

Knuth said that while businesses will likely appreciate the lower pricing, “the use case will still dictate Windows 365 adoption more than cost.” 

The overall market for DaaS tools is set to increase from $4.3 billion in 2025 to $6 billion by 2029, according to Gartner. The analyst firm also forecast in its 2025 Magic Quadrant for Desktop-as-a-Service report that virtual desktops will become cost-effective for 95% of workers by 2027, compared to 40% in 2019. 

In that same time frame, virtual desktops will become the primary workspace for 20% of workers by 2027, Gartner expects, up from 10% in 2019.