Microsoft’s New Commerce Experience

Microsoft has made some important changes to the licencing models for their cloud products. These have been implemented in order to evolve with their customers to meet the needs of their ever-changing business. These changes involve moving Microsoft 365, Dynamics 365, Power Platform and Windows 365 onto the Microsoft New Commerce Experience (NCE) platform.

In 2019 Microsoft Azure was the first offering introduced on Microsoft’s New Commerce Experience (NCE) in their Cloud Solution Provider (CSP). It was then swiftly followed by Azure Reserved Instances and, most recently, perpetual software offers.

In January 2022, Microsoft delivered seat-based cloud offers to the New Commerce Experience for Microsoft 365, Dynamics 365, and Power Platform, as well as Windows 365.

How can this benefit your business?

In simple terms, these changes can help your business drive growth by:

• Expanding your business with continuous selling
• Developing long-term business revenue through value-added services
• Reducing costs
• And accelerating your customers’ success

By bringing multiple benefits, the New Commerce Experience can also improve how your business transacts through the Cloud Solutions Provider programme:

• Microsoft 365 three-year terms are exclusively available in the new commerce.
• Again, exclusive to new commerce customers will benefit from new offers for M365 and D365.
• Like the existing experience in CSP there are three-year term offers for D365.
• For customers who need term and seat-count flexibility, Microsoft have brought in new monthly-term offers, these are priced at 20% more than annual commitment offers.
• Competitively priced annual term offers are available for stable, long-term customers.
• And for customers with seasonal or business-volume fluctuations, there’s an option to blend short- and long-term offers.
• There’s also a new set of communications offers.

New commerce in CSP - future capabilities

This year, additional features and new offers are being exclusively launched to new commerce. These are expected to include three-year term offers, hybrid use rights, home use programme (HUP), and multi-geo add-ons. Customers are expected to be able to align term end dates of new and existing subscriptions.

New Annual Term Offer Cancellation Policy

Within the New Commerce Experience Microsoft are enforcing a cancelation policy for annual term offers along with a new monthly term offer. For those purchasing the services, it will only be possible to cancel within 24 hours of placing an order. To deliver the same flexibility within CSP, Microsoft have introduced a new monthly term offer, costing 20% more than the annual commitment (annual term offer).

At the launch on the 10th of January 2022, Microsoft also released introductory promotions available until March 2022. After that all new and renewing subscriptions will need to be purchased through NCE. Another date to be mindful off, is the 1st October 2022, as from that date, all customers will need to purchase through NCE.

Microsoft is designing the new commerce experience (also referred to as “Modern Commerce”) to simplify and modernise how customers buy from Microsoft. This new experience provides businesses with more options for purchase modifications, ensuring the solutions are suitable for their business needs and goals. In 2022 Microsoft will also be adding three-year terms and multi-geo add-ons for M365.

Microsoft sells cloud products and services to customers through their partners, including Brick9, and to clients directly. If you’re currently a Microsoft customer your subscriptions, including their seat-based or license-based offers such as M365, D365, Power Platform, and Windows 365, should already be within the new commerce platform.

If not, it’s the role of your managed service provider to move existing subscriptions to the new commerce experience along with assigning new subscription orders on the new commerce.

The new commerce no longer offers customers the flexibility with annual term subscriptions, and the cost of the monthly term option, is slightly higher. But, By enforcing a cancellation policy, Microsoft is bringing CSP into alignment with other purchase actions in new commerce, along with existing Microsoft licensing programmes including the Enterprise Agreement. This ensures that customers are subject to the same terms and conditions no matter where they buy their cloud services from, and that they’re provided with a consistent purchasing experience.

The cancellation enforcement in new commerce ensures that customers committing to the entire term, will, by way of the cancellation enforcement policy, benefit from the more favourable pricing of long-term subscriptions. The premium pricing for the monthly-term option is in line with standard practice for subscription-based businesses and industries.

From March 2022, new and renewing subscriptions will transact within the new commerce experience. Benefits businesses will see from these changes include:

• Consumption-based billing for some seat-based services
• Hybrid Use Benefits
• Home Use Programme, price locked for 3 years – previously pricing was locked for just 1 year
• Enterprise upgrade offers will be available in mid-term in new commerce
• Both monthly term and annual term subscriptions are available for the same seat-based offer in order to accommodate permanent and seasonal employees
• and an add-on providing multi-geography for the MS365 product suite

Legacy subscriptions will expire on 30th September 2022 and, will need to be renewed into NSC.

If you’d like to know more, do get in touch, the team at Brick9 can advise you regarding Microsoft’s subscriptions and seats, and we’re also able to offer more options for upgrades and conversions of free trials.

You may be interested in some of our other articles and blogs, you can find those here.

Contact us