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The Latest on Microsoft’s New Commerce Experience

The Latest on Microsoft’s New Commerce Experience

Microsoft’s Cloud Solution Provider (CSP) is continually under review and adapting to changes and demands in the marketplace. As such the team at Microsoft has been working on the latest evolution of the CSP program, the New Commerce Experience (NCE).

The New Commerce Experience will change how partners purchase Microsoft online services including Microsoft 365, Power Platform, Dynamics 365, and Windows 365. Microsoft defines the change as follows

The new commerce experience in CSP is a multi-stage, multi-year transformational journey to deliver a simplified engagement experience that benefits both Microsoft partners and customers.

Essentially, Microsoft seeks to change the way you purchase licenses, with the aim of reducing complexity and offering up cost-saving incentives for longer-term commitments. The new system essentially reduces the pre-existing array of options available and adds additional features to the CSP.

Key Changes to Microsoft NCE

One of the key changes will be moving to subscription-based service which can be over three different durations: monthly, annually, or tri-annually. Here is a breakdown of the different subscription options available to you.

  • Monthly. This subscription sees a 20% price increase on current subscriptions and allows for upgrades for mid-level products. Downgrades however will not be permitted. This subscription will be billed at the start of each month.
  • Annual. This subscription has no price increase, and payments can be made annually or monthly. Again, upgrades are available, but downgrades remain prohibited.
  • Tri-annually. Again, there is no price change, upgrades are available not downgrades are not. Billing can take place monthly, annually, or upfront. The incentive behind the three-year subscription is to protect partners from potential price rises as this rate will be locked in.

Further to the above change, Microsoft will also be increasing the average price of applications and bundles by around 15%. This essentially means that regardless of your subscription method partners will be paying more for Microsoft services and this has naturally found discontentment amongst partners.
Microsoft has sought to justify the application and bundle price rise on the basis that the new value reflects the innovation and improvements to applications, most of which have been immune from substantial price rises. Until now.

The important dates

Here are the key dates that you will need to be aware of;

  • January 10th, 2022. The New Commerce Experience launches, and promotional incentives are released.
  • March 1st, 2022. All new and renewing subscriptions must now be purchased through the US. Legacy CSP customers will be able to finish their existing subscriptions.
  • June 1st, 2022. Legacy CSP customers must now renew the NCE plan to continue their subscription.
  • October 1st, 2022. The NCE must now make all purchases and all partner incentives and rebates are removed.

Additional benefits and features of NCE

These additional features will be available from March 2022.

  • Home Use Program (HUP) allows employees of organizations who use Microsoft online services to receive a 30% discount on the purchase of certain Microsoft 365 offers.
  • Multi-Geo allows organizations to store data in the various geo locations that they have chosen.
  • Hybrid Use Benefits (HUB) allows organizations to further capitalize on their Microsoft investment.

Pros and cons of the New NCE

As mentioned, not all of Microsoft’s partners have welcomed the change, arguing that they have not had sufficient time to meet the new qualifications and do not consider it to have been well explained. There also appears to be an underlying thought process that the change benefits Microsoft considerably more than it does its partners or customers. To help you decide on what the change means for you here are some of the pros and cons of the US.

Pros

  • The monthly plan remains incredibly flexible and ideal for companies with high staff turnover or seasonal workers and requirements.
  • You can upgrade subscriptions during the month.
  • You can lock in an annual or tri-annual rate, meaning you will not be affected by price rises. This can also help with company budgeting. 20% cost saving on annual and tri-annual subscriptions.
  • NCE makes it easier to try new products, and utilize free trials and add-ons.

Cons

  • The monthly subscriptions incur a 20% price rise.
  • You cannot decrease or downgrade subscriptions mid-term.
  • Owing to the rising cost of applications, you will inevitably be paying more for Microsoft.

Cancellation period

Finally, it is worth touching on the cancellation period, For any new seat-based subscription orders there will be a 72-hour cancellation and adjustment period. This provides partners with sufficient time to make post-purchase changes or corrections to orders.

We will continue to share updates as more information becomes available from Microsoft regarding MCE.