Meet Microsoft's new commerce experience (nce) for csp
Meet Microsoft's new commerce experience (nce) for csp
Microsoft CSP - New Commerce Experience
What is NCE?
The New Commerce Experience (NCE) “per seat” model for Microsoft 365, Dynamics 365 and Power Platform subscriptions are the latest in the evolution of their CSP program. It provides resellers with new tools to simplify and manage subscriptions
Why is it important to Partners?
The changes coming with NCE will potentially require some action on the partner’s side. Partners need to be mindful of the changes coming to pricing for monthly vs annual, the price changes coming in March, and the potential license ordering processes that might be necessary from their side
Announcements
No more renewals on legacy CSP
The end date for renewals of legacy CSP subscriptions on the legacy platform is July 11, 2022 (previously July 1, 2022).
Summary
- Before July 11 – can renew a legacy subscription on legacy CSP
- Note incentives on legacy CSP end Dec 31, 2022.
- After July 11 – no auto-renew on legacy
- Subscription must be either repurchased in NCE or allowed to expire.
Microsoft will not notify the partner or customer when a legacy subscription nears or reaches its expiration date. It will be the responsibility of the partner to monitor active legacy subscriptions to confirm when each one is due to expire, and to take action to migrate or repurchase the commercial seat-based legacy subscription in new commerce before the legacy subscription expires if the customer wants to continue using the subscription.
What this means for our Partners
Greater Agility and Customer Alignment
- Promotional pricing on NCE subscriptions starting January 2022
- Pricing benefits for annual term subscriptions that provide price protection
- Enforced cancellation policy
- Introduction of simplified upgrade options for selected offers
Operational Efficiency and Cost Savings
- Improved subscription management capabilities
- Automated subscription changes at renewal
- Easier price list and reconciliation file processing
More Choices for Customers
- Premium-price monthly term subscriptions that allow cancellation or seat-count reduction as needed
- Easier adoption of new products and add-ons available separately
- Consumption-based billing for telco offers
New promotional pricing to move customers to NCE
CSP Subscription Terms
Windows 10 E3/E5
Office 365
EMS/ES
Microsoft 365
Windows 365
Power Platform
Dynamic 365
12-month subscription term
12- or 36-month subscription term
The Evolution of CSP on NCE
Legacy Billing Platform
New Commerce Billing Platform
Windows 10 E3/E5
Office 365
EMS/ES
Microsoft 365
Windows 365
Power Platform
Dynamic 365
Azure Consumption services through the old Azure offer
Azure consumption Services through the new Azure plan
Reservations
Marketplaces SaaS offer
Marketplace usage-based offers
Server Subscriptions
Licenses for perpetual software
Legacy Billing Platform
Windows 10 E3/E5
Office 365
EMS/ES
Microsoft 365
Windows 365
Power Platform
Dynamic 365
Azure Consumption services through the old Azure offer
New Commerce Billing Platform
Azure consumption Services through the new Azure plan
Reservations
Marketplaces SaaS offer
Marketplace usage-based offers
Server Subscriptions
Licenses for perpetual software
Subscription Terms in the NEW Commerce Experience
1-month Subscription
Enables customers to make subscription changes as they require (increase, decrease, suspend)
Monthly term subscriptions in the NCE will be priced at a premium compared to annual term subscriptions. | Meaning, a 1-month subscription will be 20% more expensive than an annual or 36-month subscription.
12-month Subscription
Regular Commitment
Billing options
- Monthly
- Upfront
36-month Subscription
Enables a customer to lock pricing for a full 36 months.
Specific to Dynamics 365 skus
Specific Terms and conditions apply
- 3-year subscription;
- non-renewable
- prices revert to list price at end of 3rd year without the ability to cancel
Billing options
- Monthly
- Annual
- Upfront
Management of Tenants
Pause
- Subscription billing continues in “Paused” tenants
- Subscription immediately enters “Disabled” status
- Users cant access services or files
- Admins can access data until the end of the Subscription term
- Subscriptions can be made “Active” again
Cancellation
- Partner receives a pro-rated refund in the first 72 hours
- No refunds after the first 72 hours
- Subscription immediately enters “Disabled” status:
- Users cant access services or files
- Admin can access data for 90 days
- Cancellation cannot be reversed
Auto-Renew
ON
- Subscription renews at the end of the term
- 72-hour cancellation period starts
OFF
- Subscriptions do not renew at the end of the term
- Subscription enters “Disabled” status
Add On Policies
Add-ons are purchased as individual subscriptions, distinct from the base product subscriptions. Thus the end dates may not be the same
Partners will see errors when attempting to purchase new commerce add-on products when the customer does not have any of the prerequisites
This is a technical check across the whole of the customer tenant. It’s NOT a compliance check
Upgrades
For new commerce, upgrading means going from one paid subscription to another paid subscription
Full upgrade
- In-place upgrade
- All seats are upgraded
- The subscription ID remains the same
- Licenses are automatically assigned
- Upgrade at any time
For Example:
Microsoft 365 Business Basic to Microsoft 365 Business Standard
Partial Upgrade
- Some of the seats are upgraded
- The subscription ID of the original subscription remains the same
- A new subscription is created, which has an end-date that is coterminous with the original subscription
- License must be manually assigned
- Upgrade at any time
For Example:
Microsoft 365 Business Standard to Office 365 E1
Promos and Trials
Promotions and trials have preset limits (may be different limitations at SKU level). Promotions and Trials will also have pre-qualifying criteria that may include “license not being active in tenant”.
The seat limits from promotions are enforced across partners.
Promotion eligibility is enforced at the product SKU level that the partners are transacting, so a partner could get promotional pricing for 2400 seats of Microsoft 365 E3 and also a different product SKU Microsoft 365 E5.
Trials
Key facts
- 25 licenses
- 30 days
- Can’t be cancelled
- Auto-renew is On
- Trials convert automatically to paid offers
- No trial alerts
Automatic trial conversion
- All 25 seats convert to paid offer
- Paid subscription starts on the next day
- Term duration: 1 year
- Billing cycle: Monthly
Manual trial conversion
- Trials can be converted to paid offers at any time during the trial period
- At the conversion point, the 72-hour cancellation period starts when seats can be reduced
- Partners can choose the same SKU or an upgrade
Incentives and Rebates
CSP Reseller Program
To earn Microsoft CSP Indirect Reseller incentives, a Partner must have obtained a Cloud Competency and the minimum threshold for said competency.
Microsoft has raised the co-op usage threshold from $4 000 to $10 000.
Microsoft calculates your monthly incentive earnings with a 60% rebate/ 40% co-op split on eligible licenses.
All incentives and Rebates will be removed from CSP Legacy in October 2022.
Microsoft Commerce Incentive
Dates and Deadlines
14 October 2021
Technical preview 2 of NCE for Modern Work and Dynamics will be available for all partners.
1 January 2022
NCE for Modern Work and Dynamics 365 will reach general availability for indirect partners to offer to CSP resellers.
10 March 2022
All NEW subscriptions for Modern Work and Dynamics will be required to be procured through the NCE Platform.
30 June 2022
The ending of all renewals from Microsoft CSP legacy.
1 October 2022
Incentives only available for NCE transactions.
1 February 2023
All remaining subscriptions must be moved to New Commerce.
Common Questions
Q: When will the New Commerce Experience be available?
A: Microsoft released the New Commerce Experience through a technical preview 2 on 14th October 2021. General availability for all partners will launch in January 2022.
Q: Will partners be automatically moved to the New Commerce Experience in January 2022?
A: No, if a partner would like to move to the New Commerce Experience, they will need to migrate their existing subscriptions manually using the migration path First Distribution will provide.
Q: Will partners be forced to move to the New Commerce Experience?
A: All new subscriptions for Modern and Dynamics will be required to be procured on the New Commerce Experience by March 2022. All existing subscriptions can remain on CSP legacy. Partners will be able to keep existing subscriptions on the New Commerce Experience and be eligible for incentives and rebates through to October 2022.
Q: Is Microsoft offering any incentives for partners to move to the New Commerce Experience right away?
A: To encourage partners to migrate to the New Commerce Experience ahead of the March deadline, Microsoft will offer two time-bound promotions to coincide with the January general availability launch. These offers will be available between January and June 2022 on monthly-term and annual term offers. The promotion will apply to all new commerce seat-based commercial offers for subscriptions of up to 2400 seats, except for Windows 365 products.
Q: Can a partner have a customer tenant with both an annual commitment and a monthly commitment for the same subscription?
A: Yes, a partner can have a customer on both monthly and annual purchasing options for the same subscription.
Q: Can partners receive price protection if they provide a new or renew a license on or before the price change date of 1st March?
A: A partner can lock in price protection before the price increase in March 2022 by purchasing an annual commitment on the New Commerce Experience. If the partner purchases an annual subscription on legacy before March 2022, they will forfeit any incentives and rebates that would be paid out after October 2022.
Q: If customers who are purchasing through Microsoft direct want to move to Indirect CSP or are purchasing from one MSP and want to move to another, will they have to wait until the renewal period to change the channel to avoid duplicate billing?
A: Change of channel can only be done without penalty during the renewal period. If a change of channel is done within the term, the customer is responsible for the full payment of their agreement.
Q: What is the cancellation policy for subscriptions on the New Commerce Experience?
A: Partners have 3 days after purchase to cancel a subscription for a pro-rated refund. The 3 day period begins on the same day a partner starts a subscription, and no refunds will be granted after the 3 day period. Once a subscription is cancelled, this cannot be reversed. The subscription will immediately enter a “disabled” status where users cannot access services or files, however, admins will have to access data for subscription/s for 90 days.
Q: What is the renewal date for newly added seats to a subscription on the New Commerce Experience?
A: The renewal date for the newly added seats on the existing subscriptions will match the original renewal date for the subscription.
Q: Will partner margins be affected by the New Commerce Experience?
A: As of right now, First Distribution Partner margins will remain the same.