The world of Microsoft licensing is undergoing significant changes that will take effect from January 2025. These changes have been known for some time, but the implementation date is now rapidly approaching. It is now crucial to understand how these changes will specifically impact your organization. These changes not only affect how businesses acquire licenses, but also their digital transformation strategies. Whether you are a small business or a large enterprise, it is essential to understand these changes in a timely manner and prepare accordingly.
In this blog, we highlight the key changes in Microsoft licensing starting January 2025 and explain what they mean for your agreements. We will keep it clear and concrete, so you can gain insight into how these changes will affect your organization.
For a comprehensive analysis of the impact and to determine the best approach for your specific situation, we are happy to advise you further.
Changes to the Enterprise Agreement (EA) for cloud customers
Starting January 1, 2025, some cloud Enterprise Agreements (EA) will no longer be renewed under the existing EA model. Microsoft will inform these customers in early 2025 that their current EA cannot be extended. Instead, the Microsoft Customer Agreement for Enterprise (MCA-E), the successor to the traditional EA, will take its place.
What does this mean for you?
If you currently have a cloud EA, you will need to transition to the MCA-E model or consider a Cloud Solution Provider (CSP) option.
New options for businesses with fewer than 3,000 employees
Organizations with fewer than 3,000 employees are referred to by Microsoft as “SMC” (Small and Midsize Customers). According to Microsoft, the CSP model offers specific benefits tailored to the needs of this group, especially due to its flexibility and ease of use through resellers. Larger organizations, or “Enterprise” customers with over 3,000 employees, typically require more control and self-management, making the MCA-E model more attractive.
Microsoft highlights: “CSP is our hero motion for driving end-to-end success for small and midsize customers (SMC).” This refers to the role of the CSP model for businesses with fewer than 3,000 employees, which Microsoft believes better meets their operational needs.
What does this mean for you?
For organizations in the SMC segment, both the CSP and MCA-E models will remain available, each with its own pros and cons. As independent advisors, we are happy to help customers assess the impact of both models and determine which option best aligns with your licensing management and future needs.
Payment flexibility and new billing options
Starting December 1, 2024, Microsoft will offer a new monthly payment option for annual subscriptions to Microsoft 365 Copilot and other related products. This option provides more flexibility in payment methods, but there will be a 5% surcharge for monthly payments instead of annual payments.
What does this mean for you?
You can opt for monthly payments if your cash flow requires it, but keep in mind that this option will be more expensive than annual payments. Starting April 1, 2025, all products with monthly subscriptions for annual contracts will be standardized, providing more transparency in your billing.
Changes to the Maximum Resale Price (MRP)
Starting July 2025, Microsoft will revise the formula for calculating the Maximum Resale Price (MRP), which may affect the pricing of license products purchased through resellers and partners.
What does this mean for you?
Businesses purchasing licenses through partners should prepare for potential price increases starting in the summer of 2025. The revision of the MRP could raise the cost per license, so it is important to understand the possible impact on your budgets and prepare in advance.
AI integration and discount on Microsoft 365 E5
Microsoft will offer a 15% discount on Microsoft 365 E5 subscriptions for customers transitioning to the latest productivity and security tools, including AI capabilities, starting January 1, 2025.
What does this mean for you?
This discount may seem attractive, but it’s important to work with BeSharp Experts to assess whether this discount is the best choice for your organization. By exploring the various options, we can determine which scenario best fits your specific needs and which is financially most beneficial.
AI integration can make your organization more efficient and accelerate digital transformation, but it is essential to understand whether this transition aligns with your broader IT strategy and budget. BeSharp Experts will ensure that you have insight into the different scenarios, enabling you to make an informed decision.
What do these changes mean for your agreements?
The changes in Microsoft licensing will have significant implications for your licensing costs, contract structures, and how you manage technology. Whether you are transitioning to a new licensing model or seeking more flexibility in payment options, it is crucial to be well-informed about the impact of these changes on your organization.
Want to know what these changes will mean for your agreements?
Contact us today! BeSharp Experts is an independent advisor in the field of Microsoft licensing. We are happy to help you explore the various alternatives and understand the financial impact of these changes. We will ensure you have a clear view of your options, allowing you to make well-informed decisions that best align with your organization.
Since these changes can have major consequences for your licensing costs and IT strategy, it is essential to work with an independent expert like BeSharp Experts to thoroughly evaluate the pros and cons of the new options. This way, you can make a well-informed decision that best suits your organization’s needs.
Want to dive deeper into the impact and specific choices for your organization?
We are ready to support you so that you can prepare in time for the upcoming changes and make an informed choice.
Source: partner.microsoft.com/en-US/blog/article/accelerating-growth-through-partners-in-the-era-of-ai