Microsoft announces future end of new Dynamics GP sales and upcoming price increases
Over the last few years Microsoft has sent mixed signals about the future of Dynamics GP. Microsoft recently made a big announcement regarding the discontinuation of sales of Dynamics GP which makes it clear to those in the industry that Microsoft is slowly exiting the on-premise ERP business. This announcement included information on the phased end of new sales and also an increase to pricing of both subscriptions and enhancement plans. In this post, we will outline these changes, key dates, and implications of the changes for GP customers.
- October 1, 2023 – Price increases for subscription and perpetual licenses; Enhancement Plan and Advantage Plan will increase by 1 percent
- April 1, 2025 – No new sales of GP Perpetual licenses for new customers. New subscription sales can still occur for an additional year
- April 1, 2026 – No new customer sales of GP including both perpetual and subscription licenses
End of sale of new Dynamics GP licenses
Microsoft announced a plan to phase out the sale of new Dynamics GP licenses over the next 3 years. Effective April 1, 2025, new customers licensing Dynamics GP will have to use subscription licensing as perpetual license sales to new customers will be discontinued. This means that there will be no new sales of Dynamics GP perpetual licenses for new customers. Subscription sales of GP will still be available for one more year. On April 1, 2026, the sale of Dynamics GP subscriptions will be limited to existing customers, with no further sales of GP perpetual or subscription licenses to new customers.
Existing customers will not be affected by this change and can continue to purchase new licenses and modules beyond 2026. However, new customers will have limited options for purchasing Dynamics GP starting in 2025, with only subscription licensing available. This change is in line with Microsoft’s focus on investing in Dynamics 365 products for future growth.
Effective October 1, 2023, the subscription price for Dynamics GP licenses will increase. The rate of the subscription increase varies by region and will be 9% in the US and 15% in Eurozone and Africa. The perpetual license price for Dynamics GP is increasing in Great Britain, Eurozone, Denmark, Norway, Sweeden, Japan, and India but will not increase in the United States.
Additionally, any Dynamics GP customers that currently has a discount applied to their GP subscription for hosting GP on Azure will see their Azure discount reduced over the next 3 years to 10%, 5%, and 0% respectively.
Rate increases will also be seen in the Annual Enhancement Plan (EP), which will increase by 1 point for renewals and new sales from 17% to 18% of protected list price (PLP). The rate for a one-year Advantage Plan (AP) will also increase by 1 point and will go from 19% to 20%. The rate for a three-year AP will increase from 57% to 60% of PLP.
What does this mean for Dynamics GP?
This recent announcement from Microsoft is a clear signal that Microsoft is slowly sunsetting Dynamics GP in favor of the cloud-based Dynamics 365 family of business applications. No new sales of Dynamics GP means that research and development dollars will be funneled towards Dynamics 365 and not Dynamics GP.
Although Microsoft is slowly phasing out the sale of new Dynamics GP instances, Microsoft is still committed to supporting Dynamics GP for its existing users. The support lifecycle of Dynamics GP will remain the same as previously announced, and shown in the diagram below, with support from Microsoft extending into 2028 and beyond. Microsoft will continue to provide regulatory (tax) updates, security updates, and hotfixes to ensure the current version of Dynamics GP remains up to date, including any usability and reliability updates needed to address top customer issues that are critical in ensuring businesses run successfully on Dynamics GP.
While Dynamics GP users are traditionally extremely loyal to the application, this clear signaling from Microsoft is causing many companies on GP to consider migrating to a new ERP. If you have any questions about these changes or how they may affect you, you can work with a certified Microsoft partner to help you explore migration or support your existing instance of Dynamics GP.