Microsoft makes sweeping changes to its volume-licensing plans

Microsoft makes sweeping changes to its volume-licensing plans

Summary: Microsoft is unifying its myriad volume-licensing contracts, creating a new single agreement for businesses using its cloud, on-premises and, ultimately, device offerings.

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Microsoft is starting to roll out a new volume-licensing plan that unifies its myriad existing business licensing agreements into a single new type of contract.

newmslicensing

Currently, Microsoft offers a variety of volume-licensing plans for small, mid-size and enterprise customers. Those plans include everything from Select Plus, to Enterprise Agreements, to the Microsoft Online Subscription Agreement (MOSA) and the recently announced Server and Cloud Enrollment Plan.

Under the new volume structure, there will be a single volume licensing agreement for all customers "regardless of size or type" with "integrated transactional purchasing for on-premises and Online Services." Customers will sign a "Foundational" Microsoft Products and Services Agreement (MPSA) to establish themselves and Microsoft will make available various "committed offers" to all customers.

(An example of a "committed offer" may be something akin to what's required as part of the Server and Cloud Enrollment. That contract requires users to make "an installed-base-wide commitment to one or more components," for three years, to get the best price.)

Microsoft has been pilot-testing MPSA for the past year. As of December, Microsoft is starting to roll out the MPSA "more broadly" in the United Kingdom, Germany, Canada and the U.S. The initial target group is medium-sized companies, but additional countries and customer types will be coming online in 2014, according to the company.

"Simplifying the overall structure and making it easier to manage on a day to day basis are 2 key things that most, if not all Microsoft customers ask for, so this is definitely a move in the right direction," blogged Richard Gibbons, software manager at reseller Bechtle, over this past weekend. (Gibbons also provided the image embedded in this post, courtesy of Microsoft, as an aid to explaining the changes.)

The MPSA "helps show their (Microsoft's) commitment to the new paths they're taking," Gibbons told me, via e-mail. "It keeps traditional VL (volume licensing) and incorporates cloud and devices too."

Gibbons noted that Microsoft also is replacing its Volume Licensing Service Center with a new, revamped Microsoft Volume Licensing Center Web site. This is where volume licensees can manage their payment options, make purchases, and (at some point in the future) access analytics data to help them make future purchases.

Microsoft officials previewed some of the coming licensing changes in a blog post back in mid-November. At that time, Richard Smith, General Manager, Microsoft World Wide Licensing & Pricing, said the goal of the new single contract would be to streamline procurement for "a better, faster experience," plus provide "the best overall value based on total volume."

Microsoft still has a lot of education to do about the new licensing structure. Microsoft's channel partners are wondering how the MPSA changes will affect them, as CRN UK noted. 

Topics: IT Policies, Cloud, Enterprise Software, IT Priorities, Microsoft, SMBs

About

Mary Jo has covered the tech industry for 30 years for a variety of publications and Web sites, and is a frequent guest on radio, TV and podcasts, speaking about all things Microsoft-related. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008).

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20 comments
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  • And Prices ?

    Somehow I don't think they will going down.
    Alan Smithie
    • Really I got W8.1 upgrades for multiple devices for free

      Things are definitely changing for the better at MS. Azure prices are guaranteed lowest and drop every time aws prices do. This is just another great move by Ballmer. They're really going to miss him. Let's hope the new CEO gets lots of advice from him for a long time to come.
      Johnny Vegas
      • So you hope....

        Here comes the new boss, same as the old boss???

        What would be the point?
        WhoRUKiddin
      • Did I read the above article correctly?

        First you sign an agreement then they tell you what the prices are?
        MichaelInMA
        • Pricing

          I don't yet know how pricing will work with the new structure. It went into effect on Dec. 1, so hopefully answers are coming soon. MJ
          Mary Jo Foley
        • First commit, then price

          Why would they tell you what the price is before you're committed when they don't have to? It's not like you have a choice.
          symbolset
          • Pricing Requests

            You can still get quotes for the products you want to purchase, just get that pricing prior to placing the order.
            RJDarnell65
        • You may have read it correctly..

          but you misunderstand. If you make a commitment, you get the best price. So they will tell you in advance what price you will pay for committing to x amount of time. Then you sign the agreement if you want to.
          Swarvester
      • It's a service pack

        So you should, it addresses some the bugs and design flaws of W8.0.

        Don't lay the sauce on too thick, it looks obvious.
        Alan Smithie
      • A comment with no relation to the subject matter

        The article is about enterprise licensing schemes, aka volume licensing. Your home copy of Windows 8.1 does not have a relationship with this subject, unless you have a couple of hundred computers in your home.
        Mac_PC_FenceSitter
      • Come off it!

        Win 8.1 is NOT a new OS; rather, it is just a new name for a Service Pack. You still paid for Windows 8 . . . awful as it is!
        1,2,3
        • Awful as it is...

          ... in your opinion.... brilliant as it is - in my opinion.
          MelbourneTweetr
  • Microsoft makes sweeping changes to its volume-licensing plans

    Will make it easier for businesses to keep track with the licensing. For those of you asking about the price its normal to negotiate the terms first and see what you need then talk about the price.
    Loverock.Davidson
    • Even if that's the case, there's still questions to be had

      Namely, if they cost $100/month, $1,000/month, $10,000/month, or $100,000/month.

      Negotiation means that if it costs $10,000/month for my software needs, I tell them I'll give 'em $8,500, they come back with $9,000, and we sign some paperwork.

      If it's $100,000/month, I walk away without even trying.

      Joey
      voyager529
      • Talk to your rep

        If you're dealing with Microsoft, they likely have already proactively reached out to your IT dept. They are very hands on with service.
        Mac_PC_FenceSitter
  • WHAT IS THE NEW MINIMUM number of licenses?

    Would be helpful, if some specs were provided to show what the changes are. That's a biggie.
    brainout
  • What about the HUP?

    Hopefully, simpler is better ... we'll just have to wait and see.

    Where does the Home Use Program, HUP, fit into this new scheme?
    Ron_007
  • Microsoft pricing for comnercial use is totally different...

    ...from prices for personal use. Worldwide, 96% of Microsoft licenses are sold through channel partners, and they are the front end for almost all negotiations with commercial customers. It's only the largest customers who negotiate directly with Microsoft.

    The other aspect that's not so well known is that Microsoft licensing is essentially trust-based. That means if a customer says, for example, that they activated 5000 SQL Server licenses during the year, Microsoft takes their word for it and bills them accordingly. (Random audits, of course, do take place, especially on countries with high piracy). That's fairly unique in the world of enterprise software.

    The number of price bands and discount levels has always been horrendously complicated, and Microsoft sales teams have a designated "Licensing Specialist" to help customers interpret and apply complex pricing rules. The advent of cloud based products made things even more complex.

    Simplification has always been a huge demand from customers, and,it looks,like the giant has finally deigned to listen...
    jaykayess
  • Price

    I really think they should come down in price, but I don't think they will. I think a 25% cut across the board would really help consumers and Microsoft clients. They're already making all types of deals with phone makers and other companies. Let everyone else share in it. Their partners might have a much easier time moving their products
    Sonic98
  • About Time

    It's about time they simplified their licensing structure.

    I hope they sort out their stupid agreements and the time is takes to simply buy a license.
    Nazza061