Microsoft CSP — the New Commerce Experience, one year on
The changes made to the Microsoft Cloud Solutions Provider (CSP) programme in February 2022 (price increases for month-on-month committed subscriptions or the annual lock-in and no flexibility to reduce subscription quantities without penalty for the duration of annually committed subscriptions) will, by March 2023, have been rolled-out to all CSP customers under the New Commerce Experience (NCE).
Microsoft CSP — The New Commerce Experience (Medium blog April 2022)
The anecdotal impact I have seen on the relationships customers have with their incumbent Microsoft CSP partners does range across the spectrum of what good looks like.
In fairness, I have spoken to organisations for whom the experience of change was well managed; notice and explanations provided well in advance and understanding was received and accepted, and customers were able to make business decisions based upon timely, accurate and sound advice.
This is good and this is how it should be and helps towards retaining customer trust in the partner-led, ‘customer-first’ channel model Microsoft is investing in.
However, (and it certainly doesn’t matter how big or small a Microsoft partner is, the number of customers they have or the volume of Microsoft sales they do) if the ‘customer-first’ principle is not adopted, an apathy to subscription sales exists or there are not the processes or procedures in place that are mature enough, resourced enough or properly understood, the partner-led, ‘customer-first’ model will fail and customers will inevitably suffer.
This led to organisations making last-minute decisions without the time or information required to make informed judgements on what would be best for your business and signing-up to 12 months of ‘business-as-usual’ subscriptions, without review or assessment of suitability, and without any scope to readdress your subscriptions commitment for an entire year.
So, the recommended call-to-action for all Microsoft CSP customers is;
· Sense-check your current subscriptions well in advance of the renewal or anniversary date of your current agreement to ensure if annual commitment aligns most closely to your business needs.
· Check that you have been and will be able to utilise both the product title and quantities of subscriptions for the next 12 months.
This is best and recommended Software Asset Management practice — to know what you have and what you need and if there is a fit-gap, shortfall, or redressing of the commitment that will save unnecessary costs and provide a better return on investment that this can be actioned in time.
Within the Microsoft CSP subscriptions motion, this will be applicable for the Modern Workplace (Microsoft 365 or Office 365), Business Applications (Power Platform, Dynamics 365) or Add-on services (Power BI, Phone System, Project, Visio etc.).
The changes to the Microsoft CSP programme to the New Commerce Experience will inevitably impact on either the flexibility previously afforded to you (to choose both the quantities of Microsoft subscriptions you purchase through a partner) and more broadly, even the partner(s) you wish to purchase through and at the price per user subscription costs.
Microsoft CSP Key Changes — a recap
The key change was to the branding of the CSP programme to the New Commerce Experience (NCE). In my opinion, this is an exercise to lift and shift customers to a new billing schedule with a premium pricing structure introduced for monthly-committed subscriptions or the acceptance by customers to select an annual term for an agreed quantity of subscription titles (with no quantity reductions available after 7 days of the term starting).
As a consequence, the risk of customers not paying their invoices is placed wholly upon their partner / reseller and the liability for payment to Microsoft resting solely with the partner.
However, as advised before the introduction of the New Commerce Experience in February 2022, you do not need to make an ‘all or nothing’ decision concerning the quantity or duration of Microsoft 365, Dynamics 365 and add-on products you may need for your business.
The principle of aligning technology with the needs of each customer has not changed because of the rebranding and revision of a licensing programme. This, for all intents and purposes could be seen as immaterial and just a means to an end.
You can still retain control of your choice of Microsoft reseller and partner, although, the timing may now be slightly elongated if you are steered down the path of an annual contract for your licenses.
The principle of understanding needs and adopting the technology to fulfil these requirements is attainable if practising an effective and productive software asset management process.
Through review and assessment of what is needed, by whom, for how long, why, and at what time, the correct blend of both product suites and agreement durations can help to ensure the optimum licensing posture is achieved within the business.
In real life terms, determining how many users need a specific feature set to perform their role and if this is believed to be for anywhere between one month or 12 months, the NCE programme provides the flexibility and mechanisms to ensure the correct subscription, and the most suitable contract length, per user or per role, can be attained.
There is no overcoming the premium that will need to be paid for a monthly-committed subscription when compared to an annual commitment, but it does provide the flexibility for businesses to choose. For example, it may be possible for you to forecast 95 of a hundred users will require a certain product suite for at least a year, with the remaining 5% deemed to have short-term needs.
The subscriptions can be proportionally committed to on this basis, with only 5% of the subscriptions paid at a higher cost per month but with the full entitlement to remove and stop paying for these subscriptions at any time and without an early-exit penalty.
Similarly, additional subscriptions can be added at any time, for example, to cover staff brought-in for a short-term project or to meet seasonal demands and then removed at any time without incurring charges.
So, as we head towards the first anniversary of customers moving from the full flexibility of the ‘legacy’ CSP motion to the New Commerce Experience, the need to understand and align with the available and most suitable technology to minimise costs and optimise return is still, and will always be, wholly relevant (if not more so) through the New Commerce Experience and can be realised by determining the answers to these questions:
What do we need?
Why do we need it?
Who needs it?
How long do we need it for?
When do we need it?
As a Microsoft Direct CSP partner, Azure Expert Microsoft Service Provider (MSP) and Microsoft licensing specialists, we can advise and guide you on the appropriateness of CSP for your business and offer the full CSP lifecycle for optimal cost management and license compliance.
Contact us if you have any questions or go to our website for more information.
About the author:
William Nelson is a Sales Specialist with the License Management Practice at Version 1.