Effective February 1, 2027, Microsoft will implement significant price increases for virtual servers and storage services in seven Azure regions. Rates in Western Europe (Amsterdam) will rise by 9 percent, while Northern Europe (Dublin) will rise by 17 percent. In addition, older server generations will cost about 25 percent more worldwide.
Customers received a notification via Azure Service Health in early October 2026. Microsoft attributes the move to changing regional market conditions, standardized rates across regions, and ongoing investments in data center capacity and new hardware. The price adjustments do not apply to the total Azure invoice; they affect computing capacity and a large portion of storage services.
In addition to the two major European hubs, rates are also increasing in Central and South France (both 11 percent), East and West Norway (both 9 percent), and Southeast Asia around Singapore (8 percent). For many Dutch organizations, Amsterdam is the primary location, but Dublin frequently serves as a secondary site for failover and disaster recovery. Those using this architecture will soon see backup-environment costs rise at nearly twice the rate.
Which services will become more expensive?
Instead of listing affected services, Microsoft published only a list of exceptions. A moderator on the official Microsoft Q&A forum confirmed the basic principle: anything not explicitly exempted is subject to the price increase. As a result, widely used workhorses, such as the common v4, v5, and v6 generations of the popular D and E series, will immediately become more expensive across the seven regions.
Only a limited number of services are exempt from the regional price increase. For virtual machines, these include the brand-new v7 generations on the one hand and the heavily outdated v1 and v2 series on the other. Storage, including standard Block Blobs, Tables, Queues, and specialized services such as Azure Container Storage, remains unaffected.
Incidentally, the exception for older servers does not mean they are spared. According to Microsoft partner Lemontree, Microsoft is implementing a global price increase of about 25 percent for selected v1 and v2 series, effective February 1. This adjustment applies to Pay-As-You-Go, Enterprise Agreement, and Microsoft Customer Agreement customers, and thus also affects organizations that purchase through a CSP partner. This 25 percent increase is not in addition to the regional increase but replaces it.
Also read: “Azure team must cut costs by 20 percent”
Contracts and reservations only offer a delay
Organizations that purchase servers on a pay-as-you-go basis will immediately see the increase reflected on their invoices as of February 1, 2027, even if their actual usage remains the same. Those with multi-year pricing agreements have more breathing room, though clear restrictions still apply. Existing Reserved Instances retain their fixed price until the end of the term, but this covers only the agreed-upon compute usage. Storage and software licenses may still cost more. If a contract expires in 2027 without timely renewal, the server automatically reverts to the variable rate in effect at that time, causing the discount to disappear and the higher base rate to take effect immediately.
At the same time, Microsoft has long been pushing organizations toward more modern hardware. Since mid-2026, you can no longer purchase or renew one-year reservations for various older series, and for common series such as the Dv3 and Ev3, both the one- and three-year terms have already been discontinued.
Furthermore, the exchange policy will change as of February 1, 2027. From that date onward, new reservations for services covered by Savings Plans will no longer be exchangeable, while older contracts will retain a maximum of one exchange option. Even a Savings Plan for compute does not protect against the increase. Although the agreed-upon hourly rate remains the same, the underlying rates are increasing, so that same amount covers less server capacity. Anything above that will be billed at the new PAYG rate.
Moving to Amsterdam is not a given
On paper, moving workloads from Dublin to Amsterdam seems attractive to soften the blow. In practice, however, that is not guaranteed. Western Europe has been grappling with significant capacity constraints for quite some time. According to Azure MVP Aidan Finn, organizations in Amsterdam regularly encounter error messages stating that specific server types are unavailable.
Lemontree also emphasizes that an approved quota, a Reserved Instance, or a Savings Plan does not, in and of itself, guarantee physical hardware capacity in a data center. Anyone looking to migrate to save costs must also factor in migration costs, network latency, data-sovereignty compliance requirements, and redesigning the failover and recovery architecture.
What does this mean for the IT budget?
This isn’t the first time Microsoft has raised enterprise rates. As of November 1, 2025, the company had already eliminated volume discounts on cloud services such as Microsoft 365 and Dynamics 365 for large enterprises. While Azure was spared at the time, this new measure affects the operational core of many cloud environments.
Although February 2027 still seems far off, the announcement is pushing IT departments and financial managers to fine-tune cloud management and FinOps now. Effective preparation starts with a targeted assessment via the Azure portal or Azure Resource Graph to identify which VMs and storage volumes are running in the affected regions, with special attention to Dublin.
Also, accelerate the migration of applications running on outdated v1 and v2 hardware to newer generations to avoid the 25 percent global storage surcharge and keep a close eye on contract dates. Equally important is “rightsizing.” As rates rise, overcapacity carries an even heavier financial burden. In practice, aligning server capacity more closely with actual usage often yields greater long-term savings than moving to another region.
It is currently unknown whether Microsoft will send even more detailed notifications for each individual subscription before February 2027.