Microsoft has a long history of providing licensing programs directly to businesses, with its Enterprise Agreement (EA) model historically being the preferred choice for larger organisations. The EA program has been rooted in commitment-based volume licensing, designed to suit businesses needing a large quantity of on-premises software or cloud licences with a fixed three-year commitment. However, recent developments suggest that Microsoft is transitioning its focus towards the Cloud Solution Provider (CSP) program for certain market segments. This shift has left many EA customers navigating a transition they may not have anticipated.
Why Is Microsoft Pushing EA Customers to CSP?
Microsoft appears to be realigning its licensing strategies to emphasise the CSP model. Initiatives like “CSP Acceleration” and “CSP Marketing Moments” indicate that the company is actively encouraging adoption of this newer licensing channel. Evaluations of EA customers are being conducted, with many being asked to transition. While we are not privy to the evaluation criteria, we have been told that the selection is based more on specific customer requirements than organisational size.
This focus on CSP aligns with Microsoft’s broader goals of modernising the customer experience, enhancing partner relationships, and streamlining licensing management. By encouraging the shift, Microsoft aims to simplify licensing, improve support structures, and provide greater flexibility to customers.
What Is CSP?
If you procure Microsoft software and cloud services, you’ve probably heard of the Microsoft Cloud Solution Provider program – CSP. Introduced in 2015, CSP is a licensing agreement designed to allow organisations to procure Microsoft cloud services and software licences through Microsoft partners. These partners often bundle the licences with their own services to provide a comprehensive solution.
The CSP model places a skilled partner between Microsoft and the customer. This partner manages the subscription, billing, and support on behalf of the customer, serving as a single point of contact for all licensing and cloud-related needs. The result is a more streamlined experience for the end user.
Beware of the Zero-Cost, Zero-Value Provider
The CSP model was designed to scale Microsoft’s support and customer success through skilled partners. However, this shift has left traditional resellers struggling to adapt, as they are now required to build a capable support business rather than simply reselling licences. Some will rise to the challenge, while others won’t. A lower initial price might seem appealing, but when you need real support, will your provider be up to the task?
CSPs are required to provide support for the Microsoft products they sell, but not all partners have the expertise to deliver ongoing value. Beyond reactive support, maintaining a modern cloud environment requires continuous improvements as Microsoft rolls out new features. Choosing a skilled CSP ensures access to Microsoft’s latest investments, helping businesses achieve better cloud outcomes.
When selecting a CSP, look beyond the price and assess whether the partner has the experience and capabilities to provide continuous improvement, proactive management, and access to Microsoft’s latest advancements.
Benefits of Transitioning to CSP
For businesses moving from EA to CSP, the model offers several advantages:
Enhanced Billing Flexibility
- Unlike EA’s rigid three-year commitments, CSP provides greater flexibility. Customers can opt for monthly or annual billing, and annual subscriptions even offer the convenience of monthly payment plans
Simplified Support
- With CSP, your partner handles all aspects of your licensing and support. This single point of contact eliminates the complexity of navigating multiple channels for different issues.
Improved Customer Experience
- The CSP partner’s role extends beyond billing to include ongoing support, guidance, and tailored solutions. This closer relationship is intended to make your licensing experience more seamless and responsive.
Scalability
- CSP is better suited to businesses with evolving needs. Whether scaling up cloud services or adjusting licensing requirements, the model’s flexibility makes it easier to adapt without being locked into long-term agreements.
The Broader Implications for Businesses
The shift from EA to CSP represents more than just a change in licensing agreements. It reflects a broader transformation in how Microsoft envisions its relationship with customers and partners. By empowering CSP partners, Microsoft ensures that customers receive personalised support and tailored solutions. At the same time, this shift allows Microsoft to focus its internal resources on innovation and product development.
For businesses, this means working more closely with CSP partners to maximise the value of their Microsoft investments. While the transition may initially feel disruptive, the long-term benefits of flexibility, simplified billing, and enhanced support make CSP a compelling option – when the right CSP partner is selected.
Navigating the Transition
If your organisation is being asked to move from EA to CSP, it’s important to engage with a knowledgeable CSP partner.
The right partner can:
- Assess your current licensing requirements.
- Provide guidance on optimising your cloud usage.
- Ensure a smooth transition with minimal disruption.
- Offer ongoing support and proactive management of your licensing needs.
Conclusion
Microsoft’s shift from EA to CSP underscores its commitment to modernising the customer experience and empowering its partner ecosystem. While the transition may require adjustments, the CSP model offers clear advantages in terms of flexibility, support, and scalability. However, choosing the wrong CSP—one that offers little more than basic licence provisioning—can leave businesses without the support they need when challenges arise.
By partnering with the right CSP provider, businesses can not only navigate the transition but also unlock new opportunities for growth and innovation. If you’re evaluating your options, get in touch with the Codify team to see if we are the right partner for you. Our expertise in Microsoft cloud services and licensing can help ensure a seamless and value-driven transition to CSP.