The next phase of Microsoft’s New Commerce Experience (NCE) is coming soon. The new seat-based cloud subscription offers to the NCE will now include Microsoft 365, Dynamics 365, Power Platform, as well as Windows 365.
In this article, BCN Group have covered three core reasons why Microsoft is making the transition to the second phase of the NCE. Find out the multiple benefits of how customers will now transact via the CSP program and Microsoft’s reason behind the move.
1) Streamlined purchase process and simplified contract agreements
The New Commerce Experience brings a streamlined approach to a customer’s purchasing process, where new predicted payments through a single agreement for cloud services and software offer a simplified contract agreement.
Customers will now be able to manage their licenses throughout the full term of the agreement through a Microsoft certified partner or representative. In addition to the implementation of per-user/ seat-based subscription licenses, simplifying businesses licensing with no more device counting for Microsoft 365, Dynamics 365, Windows 365, and Power Platform.
The current legacy system offers over 30+ licensing programs, over the next few years this will be reduced to three main streams:
- Breadth Motion (primary buying motion in the NCE) – Cloud Solution Providers (CSP) through a partner
- Enterprise Motion (recommended for organisations with over 2400 seats) – Enterprise Agreements
- Self-Service Motion (recommended for organisations below 50 seats) – Microsoft Direct
2) Greater choice and flexibility in how customers purchase
Microsoft’s current, legacy system means that customers can only purchase Microsoft 365 product subscriptions on a month-by-month basis, rather than having alternative options.
With the NCE, Microsoft has enabled payment options that align all of a business’s Microsoft subscriptions into one model. Customers have a variety of subscription offers including monthly subscriptions (at a premium price (20% increase)), giving flexibility for businesses that are unsure of their long-term Microsoft 365 commitments, or those which need to make regular changes to the number of seats they need.
Unlike the legacy system, customers now have the option for annual subscriptions where they can choose to either be billed on a monthly or annual basis.
In addition, a 36 month (three-year) subscription will also be on offer, available for Microsoft 365 and Dynamics 365. Payment options follow that of the annual subscription, where customers can choose either to be billed monthly, annually or, for the 36-month option, upfront.
One core benefit of the new pricing model is that pricing will be fixed for annual and 36-month contracts, enhancing financial security as there will be no price fluctuations. Additionally, billing will be aligned to each calendar month synchronizing a business’s monthly costs.
Across each subscription model, customers will be able to increase the number of seats they have at any time but can only decrease seats once their contract comes to an end.
Note: All new and renewing subscriptions following March 1st, 2022 will be aligned to the New Commerce Agreement, and there will be only one Microsoft contract for customers to agree; the Microsoft Customer Agreement contract.
3) New Features
In addition to the flexibility of the New Commerce Experiences payment options, in 2022 the NCE will come with a host of new features and functionalities not seen before in the current, legacy system.
The new NCE features include:
Multi-Geo will enable organizations to provide and store data in the various geo-locations they have chosen to meet data residency requirements. In the current legacy system, this is only available for customers on Enterprise Agreements (EA) or Enterprise Subscription Agreements (ESA). However, the NCE will enable access for all customers purchasing services through a CSP in 2022.
Home Use Program (HUP):
The Home Use Program will allow employees to take advantage of purchasing a M365 sub with a 30% discount.
Hybrid Use Benefits:
Hybrid Use Benefits will allow organisations to capitalize on their Microsoft investments made via the CSP program.
New Communication Credit offers:
New Communication Credit offers were previously only available as an Enterprise Agreement benefit, the NCE will see access to all new customers.