January 12, 2022
Microsoft is changing the way organizations will purchase and manage their licenses through their Cloud Solution Provider (CSP) Program. Microsoft’s new program is called the New Commerce Experience (NCE), and it was designed to offer a better user experience, streamline decision-making, and reward organizations for making longer-term commitments. Let’s explore this change and how it might affect your organization in more detail.
What Is The New Commerce Experience?
The New Commerce Experience (NCE) is basically a simplified pricing model that will change how and when you purchase Microsoft 365 licenses. This new model is intended to streamline decision-making by offering three straightforward buying options. The size of your organization and its needs will dictate which option is best for you, but you will save money if you can make a longer-term commitment.
Important Dates To Plan For
From January through June 2022, monthly subscriptions will be available at annual pricing.October 1, 2022: All customers will be required to purchase through NCE.
July 2023: All remaining subscriptions on CSP legacy must be moved to the NCE.
Buying Options
Monthly Subscription
If you need the flexibility to make frequent changes to your Microsoft 365 or Office 365 plans, you will be able to renew your licenses on a monthly basis. However, you’ll pay a premium for the additional flexibility: currently, month-to-month plans cost about 20% more.
12 Month Subscription
Even if you can only make a one-year commitment, you’ll be able to save a significant amount of money. You can still be billed on a monthly basis if that’s easiest for you, or you can pay annually. Regardless of which billing option you choose, your price will be locked in for the entire year. That said, you still have a bit of wiggle room with a 12-month contract – you can increase the seat count, but you can’t scale back.
36 Month Subscription
One of Microsoft’s many goals in switching to the NCE was to reward longer-term contacts. So if you are in a position to make a three-year commitment, you’ll save even more than 12-month subscribers. With this option, you can still be billed on a monthly basis, but you can also choose to be billed annually or pay upfront. And just like with the 12-month subscription, you can scale the seat count up, but not down.
Advantages
- Price protection for up to 36 months
- Billing will be better aligned with each month
- Simplified terms and conditions
- Home Use Program (HUP) allows employees to purchase a Microsoft 365 subscription with a 30% discount
- Hybrid Use Benefits (HUB) for all subscriptions
- Communication credits for audio conferencing and plan minutes
- Multi-Geo capabilities are included for all subscriptions
- Easier subscription changes, renewals, and upgrades
Disadvantages
- Shorter-term commitments will cost more
- For longer-term commitments, you can only reduce your license at the end of your term
- You won’t be able to switch licensing partners until the end of your term
Advice From A Microsoft Partner
In general, we would recommend not putting off this switch, and locking in your rate as soon as possible. While no one likes additional changes, especially those which affect price, the NCE is ultimately designed to ultimately make your life easier, and there are more advantages than disadvantages to this new platform.
However, you might have already discovered that researching this complex topic can be very difficult, and making long-term plans these days can pose an additional challenge. Marco’s experts are always happy to make a recommendation for your organization that takes your present circumstances as well as your future goals into account.
