Change is coming! What do Microsoft’s latest announcements mean for you?

The introduction of Microsoft’s New Commerce Experience (NCE) in January 2022 altered the landscape for Microsoft partners with revised pricing and some significant changes to the way subscriptions were activated and managed.

With the platform now well-established, Microsoft has made some further announcements with changes that are set to impact both cloud solution providers and their customers.

But what are these recent announcements, and what do they mean for you? We’ve summarised the big talking points below.

1. Partner-to-Partner transfers are now live

While CSP offered rolling monthly plans, which could be easily scaled up or down as needed, the introduction of Microsoft NCE brought a new, enforced annual model. Microsoft and Office 365 licences could still be purchased as a monthly commitment, albeit at an increased price point, or purchased on a 12-month subscription without incurring any additional costs. This had a big impact on customers, who were now committed to a full licence term, with no opportunity to scale down as they had done previously.

But there were also some big implications for partners, too. Yes, their existing customers could now be locked into 12-month licences, but there was little opportunity to win additional business outside of existing renewal dates. This also caused complications for businesses managing acquisitions, mergers and dissolutions who were now unable to easily transition their estate to a single, preferred provider.

It’s unsurprising, then, that Microsoft has introduced a new Partner-to-Partner transfer option within NCE. A long-standing Microsoft Azure feature, Partner-to-Partner transfer allows end user customers to switch their existing licences to another Microsoft partner.

 

While transfer can’t be orchestrated through the Cloud Marketplace, they can be actioned manually in platform through Exertis Cloud with a standardised process in place to ensure a seamless switch. Crucially, any existing offers, pricing and renewal dates are also automatically carried over, so customers making a switch are protected. Any switch for monthly plans will take place at an agreed date, with both partners covering the proportion of the licence delivered under their remit. For upfront annual licence payments, the outgoing partner will receive a full credit for the remaining licence term, with the new partner then covering the difference up to the point of renewal.

While the risk of losing existing customers before renewal might create some angst, this should be balanced against the opportunity to win new business. However, only partners who can evidence their own added value, and demonstrate an ability to help customers get more from their investments in Office and Microsoft 365 will realise the benefits, which is where support from the experts in the Exertis Cloud team can become a real differentiator.

2. New pricing policy for Microsoft Teams

Previously included with all Enterprise Microsoft and Office 365 licences, any new subscriptions activated from 1st July will now have to purchase Microsoft Teams as a paid add-on.

While this will create an additional premium for new customers, the good news is that this won’t apply to the renewal of any existing subscriptions (including those transferred across from other partners).

Business plans, including Basic, Standard and Premium will also still include Teams as standard, but versions of these without Teams will now also be made available, an attractive option for those leveraging other platforms such as Zoom or Slack.

3.Summer is over for education CSP

Although commercial licences have been NCE-only for some time, education subscriptions could still be managed through the legacy CSP platform. But from 1st August, that will no longer be the case.

Any upcoming renewals or new purchases will need to be activated as new subscriptions inside the NCE platform. Microsoft will also be ending existing partner incentives, including rebates and co-op funding, available through CSP from the end of March next year.

The move to NCE will see education customers locked into 12-month licences just like their commercial counterparts, and those looking to pay monthly will see a cost increase of around 20%.

Microsoft is however introducing a promo offer, live until the end of December 2024, offering additional discount on monthly plans to reduce the impact of any increase. Education customers, and partners delivering these licences, will also enjoy the same Partner-to-Partner transfer rights as those with enterprise and business plans.

4. New price point for Microsoft Dynamics 365

Microsoft is set to increase the cost of Dynamics 365, with new pricing taking effect from 1st October 2024.

This pricing change, which covers both Dynamics 365 Enterprise and Premium, is the first pricing increase for over five years. Further details can be found in this Dynamics 365 blog.

Capture Microsoft opportunities with Exertis Cloud

With so many changes in the offing, it can be difficult to know exactly what this means both for your business and your customers. Fortunately, that’s exactly where the Exertis Cloud team can help.

Book a call with a member of our expert team today to discuss how you’ll be impacted by these announcements, and how you can ready yourself to capitalise on any new opportunities that may emerge.