Microsoft has updated their Cloud Solution Provider (CSP) program to continue to adapt to the changing needs of their customers and partners. Microsoft maintains their goal to reduce complexities and costs while maintaining flexibility for growing organizations within the CSP program. Part of this goal is achieved in the New Commerce Experience (NCE) for commercial seat-based offers on Microsoft 365 (Office 365), Dynamics 365, Windows 365, and Power Platform.
Under this new agreement, you and your customers will experience a more streamlined and improved process for buying and consuming Azure and cloud services like Dynamics 365, Microsoft 365, Windows 365, and the Power Platform.
What Does NCE Mean for a Microsoft Partner?
Partners will need to work directly with clients to ensure they understand the licensing changes and select the correct level and type of license during their annual renewal. Each organization will have different needs and scenarios that will need to be thought out. We recommend communicating the NCE update to your customers as soon as possible and then reaching out directly to each individual customer at least one month prior to their annual renewal to start the planning process.
Licensing Discounts Available
Beginning January 10, 2022 commercial seat-based offers in NCE will be priced at:
- 5 percent discount for annual term subscriptions. This promotional pricing for annual term will be in effect through March 2022.
- monthly term subscriptions will be priced the same as the regular term price through June 2022.
Options for your Customers
While working with your customers, you’ll want to explain the three options they have for licensing moving forward:
Option 1: Annual Subscription
Work with your customer to determine the number of set users they will need throughout the entire year. Once the annual subscription is finalized, customers will be able to purchase additional licenses at a later date, but will be unable to decrease licenses until the annual contract is up for renewal.
Option 2: Flexible Subscription
Your customer can keep the same monthly subscription model they currently have, which includes the option to increase or decrease users at any time. This option comes at a premium license cost of 20% higher than standard licenses.
Option 3: Hybrid Subscription
This option allows your customers to purchase licenses at both the annual and flexible subscription. Lock in a lower rate for those users you know you’ll need for the entire year and have the flexibility to add or remove users who won’t need access to your systems long-term. This is an ideal choice for any of your customers who have an increase or decrease in users for a short period of time.
Timeline for Transition to New Commerce Experience
- March 10, 2022: New subscriptions must be purchased in NCE
- July 1, 2022: Legacy subscriptions must be renewed into NCE
- December 31, 2022: the retirement of legacy CSP seat-based offer incentives
Your customers who are currently on a traditional licensing program with an on-prem solution such as Dynamics GP, SL, or NAV will not be impacted by this change at the current time.
The Stratos Cloud Alliance works with partners to help navigate pricing and licensing changes from Microsoft. If you’re not currently working with SCA but would like assistance, please contact us directly.
Learn more about the New Commerce Experience in the video below. During this Partner Chat, Microsoft, Velosio, and Stratos Cloud Alliance discuss the impact on NCE for Microsoft partners.
- Microsoft Updates for January 2022
- Overview of the New Commerce Experience
- Partner Opportunities with NCE
- Three Offer Terms
- Pricing for New Orders or Renewals