Microsoft is updating its licensing as it looks to enhance the digital transformation journeys of clients and partners. Part of this goal is achieved in the New Commerce Experience (NCE) that will affect business seat-based offers on Microsoft 365 (Office 365), Dynamics 365, Windows 365, and Power Platform. The other part of this transformation is an increase in pricing.
All Microsoft partners, like Opal, are impacted by this change to the business licensing. We are working with a team of Microsoft licensing experts as well as our in-house experts to help you take full advantage of the benefits, features, and opportunities the changes provide.
What does this mean for you?
We will be reaching out to each of our clients to ensure you understand the licensing changes, price increases, and work with you to select the correct level and type of license when it comes time for renewals. We understand price increases and licensing changes are never a pleasant discussion, but please understand we have been and continue to work with Microsoft to be able to provide the best possible solutions for our clients. In short, there are two things to be aware of. First, some prices will go up. Second, the way you license software will change under the new NCE platform.
What products will be getting a price increase?
On March 1, 2022, the following price increase will occur:
- Microsoft 365 Business Basic (from $5 to $6 per user)
- Microsoft 365 Business Premium (from $20 to $22)
- Office 365 E1 (from $8 to $10)
- Office 365 E3 (from $20 to $23)
- Office 365 E5 (from $35 to $38)
- Microsoft 365 E3 (from $32 to $36)
In addition to the pricing changes, the way licenses are provisioned will be changed as well. Microsoft has indicated NCE licensing will have three options for licensing moving forward:
Option 1: Annual Subscription
Once the annual subscription is finalized, you will be able to purchase additional licenses at a later date but will be unable to decrease licenses until the annual contract is up for renewal. This is where we will work with you to determine the number of set users you will need throughout the entire year.
Option 2: Flexible Monthly Subscription
You can keep your licensing monthly, which is what you are most likely used to today and includes the option to increase or decrease users at any time. However, Microsoft will now charge you 20% higher than standard license prices to retain this monthly flexibility.
Option 3: Hybrid Solution
This option allows you to purchase licenses at both annual and flexible subscriptions. Lock in a lower rate for those users you know you’ll need for the entire year and have the flexibility to add or remove users who won’t need access to your system’s long-term. This is where we will work with you to determine the correct number of annual and the correct number of monthly licenses needed.
When will the new license provisioning take place?
Timeline for Transition to New Commerce Experience
March 10, 2022: New subscriptions must be purchased in NCE
July 1, 2022: Legacy subscriptions must be renewed into NCE
December 31, 2022: The retirement of legacy CSP seat-based offer incentives
We have looked at your current licensing and will be reaching out to coordinate changes in plenty of time. However, please feel free to reach out to any of our experts at NCEHELP@OPALBIZ.COM .
Are Licensing Discounts Available?
Microsoft may offer discounts for certain licensing and changes. We will discuss those discounts, if applicable when we reach out to you.
Does this include On-Premise Licensing?
Traditional licensing programs with an on-prem solution such as Dynamics GP, SL, or NAV will not be impacted by this change at the current time.
In the coming weeks and months, we plan to keep you updated with announcements about the new commerce experience and will have additional resources available to guide you.