Microsoft raises subscription cost in Nigeria amid job cuts

Microsoft is laying off staff from its African Development Centre in Nigeria. This comes after the company recently raised subscription prices for at least one of its Microsoft 365 services in the country.

The ADC, launched in 2019, was opened in Nigeria in 2022. At the launch in Nigeria in 2022, Gafar Lawal, the ADC’s West African managing director, disclosed that Microsoft has spent about $200 million on the ADC since 2019.

“The facility will continue our efforts towards training, equipping, and hiring engineering talent in Nigeria and West Africa as a whole to contribute to the development of Microsoft products that are in use by over one billion devices and empowering millions of users and organisations across the world to do more,” said Lawal.

Since its launch, the ADC has reportedly hired about 120 engineers and has about 200 employees.

While the exact number of affected employees is unknown, reports suggest the layoffs will primarily target the ADC’s engineering team. Microsoft confirmed that adjustments are a part of regular business management.

“Organisational and workforce adjustments are a necessary and regular part of managing our business. We will continue to prioritize and invest in strategic growth areas for our future and in support of our customers and partners,” a statement attributed to a Microsoft spokesperson read.

These job cuts follow Microsoft’s decision to increase subscription prices for its 365 Personal plan in Nigeria twice since September 2023 due to changing market conditions.

The price jumped from N26,999 to N36,999 in September and will further increase to N49,999 as of June 1, 2024, marking an 85.19 percent increase.

A Microsoft 365 subscription gives users access to Microsoft Teams, Word, Excel, PowerPoint, Outlook, OneDrive, and more.

“As of 01/06/2024, the subscription fee for Microsoft 365 Personal will change from NGN 36,999.00 to NGN 49,999.00 to address changing market conditions. This price change enables us to maintain the high levels of service and product quality that you expect from us, and we value and appreciate your continued support,” said Microsoft.

A recent devaluation of the naira and worsening macroeconomic conditions in Nigeria have forced many companies to shut down and pushed many to increase prices. Companies such as Multichoice, Netflix, and Google, among others, have had to raise their subscription prices.

After it raised prices, Netflix said, “As we continue to add more TV shows and movies and introduce new product features, our plans and prices may change. We also may adjust plans and pricing to respond to local market changes, such as changes to local taxes or inflation.”