Microsoft’s new licensing rules for Cloud Providers


Microsoft have just announced a range of changes to their rules around using their software in SOME cloud environments, aimed at reducing some of the heat they’ve been receiving from European cloud providers – including complaints to the European Commission – and also heading off potential issues with the EU Digital Markets Act.

The changes include CSP access, more support for providers from Microsoft, and some changes to Software Assurance licensing rules too.

Background

Microsoft have been under fire from various angles due to their licensing rules that restrict which products can be used within 3rd-party datacentres…particularly when compared to Microsoft Azure. It recently came to light that ‘OVHCloud’ lodged a complaint with the European Commission in 2021 and many of the “Fair Software Licensing Principles” were seen to be aimed at Microsoft too.

The current BYOL (Bring Your Own Licensing) rules of Microsoft restrict certain on-premises licenses from being used in cloud environments (apart from Azure) which, for some customers, causes frustration and higher costs…and in some cases it means a project cannot be completed.

What’s changing?

Microsoft have announced a big new focus on ‘European Cloud Providers’ (ECP) – giving them expanded access to CSP (Cloud Solution Program) as well as creating a new internal team to focus on supporting them and their customers.

Cloud providers can host more products

The ECPs will be able to offer hosted desktop solutions containing Windows desktop and Office – including Office 365 Apps for Business/Enterprise. They will offer this via their own “unified solutions” and also by hosting customer-owned licenses – hugely expanding the available options for customers.

Microsoft are also expanding the availability of long-term fixed pricing for these providers, removing some of the pricing volatility from them and their customers.

Software Assurance changes

This is a pretty big one – Microsoft are adding ‘License Mobility’ rights to Software Assurance for Windows Server, Windows desktop, and Office. This means customers can use their on-premises licenses in 3rd-party ECP datacentres (but not AWS, GCP, or Alibaba), something that wasn’t possible before.

New Windows Server licensing option

Windows Server is licensed based on the physical CPUs and cores within the server. Microsoft are now introducing the ability to license just the virtual capacity you need, regardless of the underlying hardware. Whether this will be available globally and across all licensing programs, or restricted to just ECP datacentres, is something we are yet to discover.

European Cloud Providers – and more?

Although Microsoft’s announcement was careful to keep referring to ‘European Cloud Providers’ – it seems a Microsoft spokesperson has confirmed that the CSP and Software Assurance changes apply globally (via Mary Jo Foley). This means the vast majority of cloud providers are now able to offer something to their customers that they couldn’t previously.

On the flipside of that though, the main takeaway is that this doesn’t help customers looking to run software on AWS, Google, and Alibaba (the Listed Providers) and, in all honesty, that’s where I see most of the customer issues in this area. However, perhaps Microsoft hope that not only will these changes placate the EU but that they will also divert business away from the Listed Providers to smaller partners instead. In the new world, Microsoft may see that as a win…sure, they’re not on Azure…but they’re not on AWS either.

Update:

Microsoft have confirmed here that these changes do NOT apply to the Listed Providers – Amazon, Google, and Ali-Baba.

Other changes

Microsoft have outlined their 5 “European Cloud Principles”:

https://blogs.microsoft.com/eupolicy/2022/05/18/microsoft-responds-to-european-cloud-provider-feedback-with-new-programs-and-principles/?s=09

and also discussed their plans to further partnerships around providing sovereign clouds for various European governments.

Microsoft’s full announcement is here.

Microsoft non-profit price increases – 2022


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Microsoft have announced a set of price increases for the non-profit sector from September 1, 2022. The pricing is as follows:

ProductCurrent priceNew price (Sept 22)
Office 365 E1$2.00$2.50
Office 365 E3$4.50$5.75
Office 365 E5$14.00$15.20
Microsoft 365 E3$8.00$9.00
Microsoft 365 Business Premium$5.00$5.50

Microsoft call out that these price increases can be used to drive adoption of Microsoft 365 E5 – which, just as with the commercial SKUs, doesn’t have a price increase planned.

Other changes

April 2022 also saw the end of Microsoft’s free grants for on-premises software – although non-profits in areas where Azure isn’t available can still get grants for Windows Server & SQL Server.

Microsoft are now making grants of 50 Windows Pro licenses available to non-profits, with additional discounted licenses being available

Resources

Microsoft page re: price increase

Microsoft page re: other changes

Microsoft Product Terms: April 2022


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A few areas of activity this month:

Apparently, they’ve changed the Cloud for Healthcare licensing model from per-user to per-tenant. The “User Subscription License” option has been replaced but none of the other terms have been changed, so it still refers to add-on SLs etc. and doesn’t mention that it’s per-tenant anywhere other than the change summary. It makes sense as the other clouds are per-tenant…but we need all the info!

Microsoft Endpoint Manager Remote Help add-on has been added. Eligible pre-requisites are Microsoft 365 E3/E5/F1/F3, Enterprise Mobility + Security E3/E5, and Microsoft Intune.

System Center 2022 has been added.

“Dynamics 365 Customer Voice and Digital Messaging” added.

Windows 11 Pro (per Device) is now available via CSP.

Microsoft Bookings added to Student Use Benefit for O365 A3 & A5.

Microsoft Azure Consumption Commitment (MACC)


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What is it?

Available for EA and MCA customers, the Microsoft Azure Consumption Commitment (MACC) is a 3-year agreement where an organisation commits to spend a certain amount on Azure over that time period.

It doesn’t require an upfront payment of the agreed amount, rather the total must be reached by the end of the MACC term. Ongoing qualifying Azure spend (either PAYG or the purchase of Azure Prepayment) is deducted* from the total on a regular basis by Microsoft and the remaining balance can be seen in the Azure portal (or via REST API). In this way, it adds some flexibility to what’s possible with Azure commitment and budgets.

However, it is a contractual commitment so if future Azure spend has been over-estimated, an organisation will find itself expected to make up any shortfall at the end of the agreement.

*If you receive Azure credits from Microsoft, any services paid for using those will not count towards your MACC total.

Azure Marketplace

Certain 3rd-party services in the Azure Marketplace are eligible to count towards a MACC. In the Marketplace portal, there will be an “Azure benefit eligible” option to filter the applicable services.

https://docs.microsoft.com/en-us/marketplace/azure-consumption-commitment-benefit

This has the potential to be a decent benefit for many organisations as the use of cloud marketplaces is currently skyrocketing.

Resources

https://docs.microsoft.com/en-us/azure/cost-management-billing/manage/track-consumption-commitment?tabs=portal

https://docs.microsoft.com/en-us/marketplace/azure-consumption-commitment-benefit

https://docs.microsoft.com/en-us/azure/marketplace/azure-consumption-commitment-enrollment?msclkid=8f732ce1b10c11eca28f584e00856880

Microsoft Product Terms – March 2022


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Again, not a huge amount of change in the Microsoft Product Terms for March 2022:

Microsoft 365 Privacy Management has been rebranded “Priva”…I thought they might change their mind on this one 😂 I guess they wanted to make sure there was something people could confuse with Viva?!

Expanded pre-requisite licenses for Cloud for Healthcare add-on

Azure Virtual Desktop per user access promo extended to March 31st, 2022 (although the section doesn’t appear to have actually been updated)

SQL Server Big Data Nodes have been retired – anything other than the “core” SQL editions just never seems to quite work does it?

Updated “no cancellations after 72 hours” terms for online services under CSP NCE

Microsoft Viva Insights: What is it?


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Microsoft Viva is the new range of Employee Experience tools from Microsoft and is made up of a range of Viva products:

  • Insights
  • Topics
  • Learning
  • Connections

A brief overview of the four components is here but I want to dive deeper into Viva Insights.

What is it?

Initially it looked like it would build upon the Workplace Analytics product but Viva Insights is now listed as “formerly Workplace Analytics” so it appears to be a rebrand as well as adding new features. Tbh, that makes sense as it helps to keep everything in the “Viva” bucket.

Viva Insights aims to improve employee wellbeing and productivity through using data to highlight people’s work habits such as answering emails outside of work hours and spending too much time in meetings for example. It will also provide reminders to block out time for “focus tasks” and help managers ensure they schedule regular 1-1 meetings with team members. The personal insights also include mindfulness sessions, reminders to take breaks, and a check-in to gauge a user’s mood.

https://www.microsoft.com/en-us/microsoft-viva/buy-insights?activetab=pivot%3aoverviewtab

It aims to provide insights at a team level and also an organisation wide level, enabling action to be taken wherever potential issues may arise. Given the impact of COVID-19 and the long-term increase in flexible working, anything that can help organisations better look after their employees – and enable employees to better look after themselves – is well timed and has the potential to be very useful.

I speak to a lot of people who find themselves on constant back to back video meetings and calls, with little time to process any of that information and even less to simply sit back and think and plan. More work = less productivity in many cases and Viva Insights may help with this…if used properly.

Pricing & Licensing

Viva Insights is an add-on license to:

  • Office 365 E1/E3/E5 (plus the A and G versions)
  • Microsoft 365 E3/E5 (plus the A and G versions)
  • Microsoft 365 365 Business Basic/Standard/Premium
  • Exchange Online Plan 1/2

and costs $4 per user per month.

Certain “personal insights” are available to all users with a license that includes Exchange Online, while others require the above add-on. There is also the extra consideration of Viva Insights Capacity.

Viva Insights Capacity

There are a range of additional things that an organisation can do with the data generated by Viva Insights – and this is where we get into the realm of capacity credits.

These additional capabilities include:

  • Analysis templates to quickly generate interactive Power BI reports tailored to common business scenarios
  • Advanced tools to help users query and customize metrics and combine Viva Insights data with external data, such as customer relationship management (CRM) and survey data
  • Analysis accelerators including an R-script library to help analyze organizational data trends, processes and networks
  • Built-in safeguards to help protect personal privacy
https://www.microsoft.com/en-us/microsoft-viva/buy-insights?activetab=pivot%3aoverviewtab

Pricing & licensing

Each Viva Insights license includes 1 capacity credit per month, pooled across the tenant. If an organisation requires additional capacity credits, they are licensed in increments of 5,000 credits and costs $5,000 per month.

Unused credits expire monthly.

Conclusion

Viva Insights represents two growing trends for Microsoft:

  • Software that is sold to parts of the business other than IT
  • Licensing which involves ongoing usage “credits” that can, potentially, be consumed in huge amounts across an organisation…and run up big bills

Organisations are definitely going to be looking for products that help them in this area and, within organisations already using Microsoft 365, Microsoft are well placed to be among the options.

If you’re responsible for Microsoft spend within your organisation, this is certainly something to keep an eye on in the future!

Further Reading

Microsoft Viva Insights

Microsoft Viva Insights Capacity

Microsoft 365 A1 per device licensing


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Microsoft have introduced a new SKU for Education – Microsoft 365 A1 for devices. It costs $38 per device for 6 years and provide the full M365 suite of apps plus Minecraft and cloud management capabilities.

The announcement seems to be aimed at Google due to the mention of “providing more for students and educators relative to competitive offerings at the same price” but, as Mary Jo Foley points out, Google’s most expensive EDU offering is $5 per student per year. Perhaps Microsoft are banking on education establishments seeing a very high ratio of students to devices?

See the Microsoft announcement here.

Podcast: Microsoft New Commerce CSP changes


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Microsoft recently announced a range of upcoming changes to CSP via their “New Commerce Experience” and it’s safe to say that it’s caused some consternation among Microsoft partners – and rightly so really.

Westcoast invited me onto their “Cloud Talk” podcast to talk through some of these changes, what they mean for partners, and what the future might look like. We also talk about the Microsoft 365 price increases.

I had a great time talking to Tom about all this and hope you find the podcast useful and interesting – we cover quite a bit in 34 minutes! Check it out on Spotify here:

For more background, check out my blog posts:

New Commerce Experience changes

Microsoft 365 price increases

Microsoft make changes to CSP license terms


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Microsoft’s upcoming “New Commerce Experience” (NCE) is bringing some changes to the CSP world, which will mean things are different for partners and customers.

Longer term contracts

3 year terms will be available for Microsoft 365 & Dynamics 365 on CSP – a change from the current max. of 12 months. This will enable orgs to protect against price increases over a 36 month period and makes a lot of sense, given Microsoft’s aim to move many Level A Enterprise Agreement (EA) customers to CSP from 2022 onward.

Flexibility costs money

Microsoft say that there will be “new monthly-term offers with a price premium for customers who need term and seat-count flexibility“. One very attractive feature of CSP has always been the ability to reduce/cancel license quantities at a moment’s notice without penalty…the above statement suggests that customers who still want that will have to pay for the privilege.

Customers will be able to combine short/long term licenses, which is great for industries where seasonal fluctuations bring a short term increase to the user base. This is something that was addressed in the MPSA several years ago, before it lost its mantle as the “next big thing” to CSP.

There are various other changes to help partners offer a better service to customers including:

  • Streamlined trial conversion
  • Add-ons available separately
  • Enhanced management capabilities

All changes hit General Availability on October 1, 2021 although some won’t be available in Brazil until February 2022.

Microsoft add telephony features to Microsoft 365


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Microsoft have announced their intention to add unlimited dial-in minutes to a wide range of Office/Microsoft 365 SKUs. Currently available with E5, the expanded range will cover:

  • Microsoft 365 E3/F1/F3
  • Office 365 E1/E3
  • Microsoft 365 Business Basic/Standard/Premium

Further extending Microsoft’s telephony offering to a wider range of businesses and users – which has to be a good thing right?

This change will take effect from March 2022.

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