MICROSOFT CSP IS CHANGING – HERE ARE THE HIGHLIGHTS!

MICROSOFT CSP IS CHANGING - HERE ARE THE HIGHLIGHTS!

Many businesses across the world use Microsoft’s various cloud-based products, and those businesses will be familiar with the Microsoft Cloud Solution Provider Program, also known as Microsoft CSP.

Microsoft CSP is the platform that businesses can access Microsoft’s public cloud solutions, such as Office 365 and Microsoft 365 through their I.T. provider.  

As accredited partners of Microsoft, CSG provides expert I.T. solutions to several companies across the country, and have been doing so since 1985.

However, Microsoft has recently announced some recent changes to its CSP model – including a name change!

From March 2022, Microsoft CSP will become Microsoft NCE (New Commerce Experience), and aside from the new name, some other key changes will impact our clients and users of the platform. 

The End Of Pro-Rata Refunds

Possibly the most significant change with the move to NCE is the end of pro-rata refunds offered with cancellation licenses. 

Currently, businesses can purchase their license on fixed 12-month subscriptions, paid either annually or monthly.  This includes specifying the number of licenses within each tier or solution they would like to purchase at the outset.

However, they still retain the flexibility to scale their licenses both up and down as required for the business.  This results in pro-rata refunds on any licences cancelled before the end of their term. 

Following the switch to NCE in March 2022, these refunds will no longer be available.  Businesses will have a 72-hour window to cancel post-purchase, and after the point, the number of licenses specified at the outset will be in place for the full subscription term.  Although there is still flexibility to add any additional licences as needed, which will be charged on a pro-rate basis. 

1- Month Contracts

We can see that the end of pro-rata refunds does impact the level of flexibility available for businesses, especially those with temporary or seasonal teams, who were used to increasing and decreasing their license usage for when they needed it. 

However, we’re pleased to note that to help satisfy that need, Microsoft has introduced an additional license option of just 1 months term. 

This will allow companies that require additional flexibility the freedom to purchase more licenses on 1-month contracts, avoiding the need for over-provision, and overspend, on longer-term subscriptions. 

Businesses in need of shorter-term licenses can therefore purchase 12-36 month licenses for full-time staff and additional 1-month licenses as and when needed.

Sadly, 1-month contracts come at a 20% premium compared to the monthly costs available with 12 and 36-month subscriptions, which are both at the same level. 

The direct implication of both the change in refund policy and the additional license options is that businesses will now need to plan and strategise more efficiently about how to purchase their licenses. 

As ever, CSG will work alongside our current clients to establish their best solution, however, we would recommend taking time to identify the needs of individual users and the license coverage required.

Working alongside our experts here at CSG will ensure a thorough and strategic plan is devised to minimise costs and avoid any unexpected challenges.

Global price increase across NCE

Unfortunately alongside the NCE announcements, Microsoft also revealed that from March 2022 it will be implementing some price increases across several products currently available through CSP.

Current UK pricing has not yet been made available, but details of the increases in USD are below:

• Microsoft 365 Business Basic – from $5 to $6 per user
• Microsoft 365 Business Premium – from $20 to $22 per user
• Office 365 E1 – from $8 to $10 per user
• Office 365 E3 – from $20 to $23 per user
• Office 365 E5 – from $35 to $38 per user
• Microsoft 365 E3 – from $32 to $36 per user

Whilst a price increase is never welcomed, it is the first price hike Microsoft has implemented since it first launched its cloud services over 10 years ago, and they’ve added some excellent features at no extra cost over the years too.

The price increase further enforces the point of developing a watertight strategy, and working alongside us here at CSG will ensure just that. 

However, fear not, there is some good news…

With the current CSP model, businesses using Microsoft Teams must pay additional fees for both dial-in and dial-out capabilities with audio conferencing. This gives users the option to dial into Teams meetings via a mobile phone as opposed to through an app, while also allowing users to dial out and connect with external numbers.

From March 2022 dial-in functionality will be included as standard, ensuring that only customers looking to include dial-out functionality will be subject to the additional charges.

For those only using dial-in, the reduction in cost associated with this feature will go some way in compensating for the price increase highlighted above.

It is worth noting that the price increase, as well as the other changes with NCE, will all come into effect from March 2022, or at the end of your current subscription term should this extend beyond this date.

What is Best For My Organisation? 

The upcoming changes are significant and worth noting, from both a financial and practical perspective.  However, fundamentally those already accessing Microsoft services through CSP will still be able to access everything they need to support their business.

With these changes in mind, we feel it is very important to take some time to review your existing I.T. services, and the licenses associated and make plans and provisions for the upcoming changes.  

Here at CSG, we will be working closely with our clients to ensure the new outlook works for them and their business, but if you have any questions about the upcoming changes or your current licenses please contact one of our team today, and we’d be delighted to assist you!