Microsoft licensing agreement models
When it comes to managing software licences and subscriptions, Microsoft offers a variety of agreement models tailored to meet the diverse needs of organisations. Understanding these models can help your organisation optimise software investments, ensure compliance, and leverage the full potential of Microsoft's offerings.
Different Microsoft licensing agreement models
Pay-as-you-go (PAYG)
Immediate access with a credit card, but it's the most expensive and lacks support and flexibility.
Enterprise Agreement (EA)
A three-year commitment for large companies, offering centralised purchasing and support, but can be inflexible and costly.
Microsoft Azure Consumption Commitment (MACC)
A 12-month contract with discounts for high consumption, but users handle their own support.
Cloud Solution Provider (CSP)
Subscription-based, flexible, cost-effective, and includes 24/7 support from SoftwareOne.
Microsoft Products and Services Agreement (MPSA)
Simplifies purchasing for on-premises and cloud services without a wide commitment, ideal for ad-hoc licensing.
Microsoft Customer Agreement for Enterprise (MCA-E)
Streamlined for cloud services with flexible purchasing and improved invoice management, suitable for outsourcing cloud service management through a CSP.
What’s the difference between a direct or indirect CSP?
Microsoft offers two different partner models, direct and indirect CSP. A direct CSP partner purchases products directly from Microsoft, which they then resell to their clients. Direct partners will provide their clients with billing, provisioning, and support services.
CSP offers businesses many advantages, including:
No minimum user or seat requirements
This makes it ideal for small businesses that don’t want to buy more licences than they need. What’s more, CSP provides organisations with different commitment levels to increase or decrease the number of users as needed. That means if there’s a large, short-term project that requires additional licences, CSP can accommodate that requirement.
No lengthy contract commitments
Freedom from long-term commitments allows companies the flexibility they need as they scale. Organisations have the option to choose monthly or annual commitments to scale as needed.
Greater engagement and support with a Microsoft partner
A Microsoft partner, like SoftwareOne, helps manage billing and invoicing, spend management, and subscriptions and 24/7 technical cloud support directly to your organisation. This allows for more attentive engagement and faster response times if there are technical or billing issues.
Discounts and pricing flexibility
There are incentive programs to discount Azure which are determined by an enterprise’s monthly consumption. The CSP programme benefits allow organisations to reduce licensing costs while optimising their infrastructure. CSP makes licensing affordable and is optimal for meeting a company’s budget because there are monthly or annual payment terms to meet your needs.
What are the disadvantages of Microsoft CSP?
When deciding between a Microsoft agreement for your organisation, it is important to consider some of CSP’s disadvantages:
No Software Assurance (SA) Maintenance Programme available
Because the software in the CSP programme is licensed only, CSP customers cannot opt to utilise the SA Maintenance Programme.
MPSA contracts are normally paired with CSP to meet any SA needs.
No “From SA” pricing SA offers EA customers a programmatic discount of 10-20% if the organisation already owns related licences covered by SA. These discounts are not extended to CSP customers.
Desktop virtualisation rights are different for CSP customers
SA customers are not charged an additional fee to access their Virtual Desktop Infrastructure (VDI) desktops if they use PCs covered under SA. And while Microsoft is eliminating the Virtual Desktop Application (VDA) add-on licensing requirement to access hosted Windows 10 or Windows 11 OS, it is limited to users of Microsoft 365 F3, Microsoft 365 E3, and Microsoft 365 E5 users who don’t have a primary Windows Pro device.
Finding a Microsoft CSP partner that’s right for you
With so many factors to consider, the need to collaborate with a partner who is experienced and knowledgeable about Microsoft licences cannot be overstated. If your organisation needs help renewing your licences and is having difficulty navigating the Microsoft licence landscape, it is time to find a partner that is right for you.
When researching Microsoft CSP partners, you may want to consider the following questions:
- Are you interested in a direct or indirect Microsoft partner?
- Does the partner provide 24/7 customer and technical support?
- Does the partner offer automated billing along with budgeting and spend alerting notifications?
- Does the partner have a strong and lengthy relationship with Microsoft?
- Does the partner offer value-added services beyond licensing?
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