As of October 1, 2009, Microsoft Office Live Small Business will no longer offer free domain name renewals.
In the information below you can see that they have decided to start charging $14.95 per domain on an annual basis.

Although not the highest price out there $15 for a domain when you can purchase one at a Domain Name Reseller like GoDaddy for $9 or as low as $7 with a coupon is a price that some might think twice about.

Some large hosting companies will offer domains for free when you purchase hosting. Many will provide more then one even on their cheapest plans just to attract customers.

In this case it may be cheaper to shop elsewhere but considering most business users really don’t care about the price they pay as long as services work Microsoft should not see a wave of customers leaving their service.

ANNOUNCEMENT NOTICE
http://smallbusiness.officelive.com/en-US/DomainPolicyChange

From the launch of our service in 2006 until mid-February 2008, during the signup process we offered a free custom domain name with the Office Live Small Business service. We’ve made a policy change and will start charging customers who signed up between the above dates the annual domain name renewal fee.

How much will it cost to renew custom domains?
An annual domain renewal fee of $14.95 per year will be due at the time of the domain renewal date.