Upcoming changes to Microsoft licensing with the New Commerce Experience.

Microsoft has recently announced the ‘New Commerce Experience’, entailing changes to the way Dynamics 365, Microsoft 365, and the Power Platform, are licensed. Ultimately, this new model aims to offer customers a consistent and simplified purchasing experience.

The New Commerce Experience was originally planned to launch in October 2021; however, this has been postponed until January 2022 to give partners and customers more time to prepare.

What is the New Commerce Experience?

Currently, the majority of businesses using seat-based subscriptions (including Dynamics 365, Microsoft 365, and the Power Platform) purchase them directly from a Microsoft Partner (like ourselves) via a programme called the Cloud Solution Provider programme (CSP). Since 2015, this has been the preferred way of purchasing licenses for businesses around the world.

With the New Commerce Experience, Microsoft is aiming to simplify their subscription models whilst still giving customers the flexibility to fit their licensing around fluctuating business needs. There will be three subscriptions to choose from, each with different rules, which are detailed below.

Additionally, this new model aligns the CSP programme with the rest of the Microsoft eco-system.

The new licensing options within the New Commerce Experience:

Starting from January 2022, customers will be able to purchase licenses in one of three ways:

  • Monthly Subscription
  • 12-Month Subscription
  • 36-Month Subscription

Monthly Subscription:

  • For this subscription, the number of seats can be increased or decreased each month or terminated at the end of each month (with month-to-month commitments), allowing users to tailor their licenses to their changing business needs
  • This will incur a 20% price premium; due to the flexibility it provides
  • Price increases are not protected and will increase with price changes by Microsoft

12-Month Subscription:

  • The customer is committed to a 12-month subscription
  • Cancellation is limited to the first 72 hours of the subscription, with pro-rated billing. After this, the customer cannot cancel and is committed to the full 12-months
  • The number of seats cannot be decreased within the 12-month term, but can be increased with pro-rated billing
  • Price protection from cost increases for the full 12-month term
  • The subscription can only be terminated after each 12-month term

36-Month Subscription:

  • The customer is committed to a 36-month subscription
  • Cancellation is limited to the first 72 hours of the subscription, with pro-rated billing. After this, the customer cannot cancel and s committed to the full 36-months
  • The number of seats cannot be decreased within the 36-month term, but can be increased with pro-rated billing
  • Price protection from cost increases for the full 36-month term
  • The subscription can only be terminated after each 36-month term

When will the New Commerce Experience be enforced?

Although the New Commerce Experience launches in January 2022, it will not be enforced until 1st March 2022. Any new subscriptions that are added on or after 1st March 2022, can only be transacted through the new model. This also applies to all renewals on or after the 1st March 2022; any existing licenses will continue as normal until their annual renewal.

Can subscriptions be mixed?

Subscriptions can be mixed, meaning customers can have both monthly-term and annual/multiyear-term subscriptions. For example, you can mix and match a core set of licenses for a longer-term and an appropriate number of seats, and have a few monthly licenses when required (however, the monthly ones will include the 20% price premium).

Contact Us

As usual, if Microsoft provide any additional updates or offers around the New Commerce Experience, we will update this blog accordingly. If you have any questions about your existing licenses or the new model, please don’t hesitate to get in touch. You can do so by filling out the contact form below, emailing us at [email protected], or calling us on 01908 038110.