There are some exciting changes coming to the Microsoft partner channel. Microsoft’s New Commerce Experience is coming for all per-user subscriptions starting January 10, 2022 (original date of GA: October 14, 2021).
Unfamiliar with New Commerce Experience (NCE)? It was initially announced back in 2019 with Azure as a simplified journey for both the customer and the partner to transact a consistent and standardized purchase motion. This time around, New Commerce Experience is transitioning subscriptions like Office 365, Microsoft 365, Dynamics 365, Windows 365, Power Platform and more to the same purchase motion.
What is the impact to my business?
As an indirect reseller within the CSP space, your business will now have options between January 2022 when NCE is generally available to July 1, 2022 when NCE is technically enforced by Microsoft.
New platform updates on Ingram Micro Cloud Marketplace will be adjusted to align with Microsoft New Commerce Experience. For example:
- New subscription term options: Monthly, Annual (Paid Monthly or Upfront), 36-Month Subscriptions* (Paid Monthly, Annual, Upfront)
- New monthly-term offers with a 20% price premium for customers who need term and seat-count flexibility
- Consistent cancellation policies: Seat-based offer terms in new commerce (limited to the first 7 days (168 hours)** of the term with prorated refund)
- Easier Subscription Management: Option to blend short- and long-term offers for customers with seasonal or business-volume fluctuations
- Subscription ownership enforcement that prevents multiple purchases of free trials and small-to-medium business (SMB) offers from different partners
- Eased transition to New Commerce: Tooling that streamlines the transition of existing subscription in CSP legacy to NCE
- Easier adoption of new products, including streamlined trial conversions and add-ons available separately in the CSP catalog
*36-Month Terms available for Dynamics 365 (January 2022), and select Microsoft 365 subscriptions (H2 2022).
**7 days (168 hours) are calendar days including weekends and bank holidays
How does the New Commerce Experience differ from CSP today?
There will be some changes in how partners need to manage their customers’ subscriptions from the existing CSP experience. With additional flexibility through subscription types and ability to mix-and-match through NCE, partners need to be more diligent on ensuring the customer is prepared to commit to the full term of the subscription. If not, to cancel within the 7-day (168 hours) grace period** for a prorated refund.
Please find some of the changes that can impact your business.
Commercial Terms and Billing
Here’s what you can do to prepare
Ingram Micro Cloud Marketplace will be ready to transact NCE products for both Per-User Subscription as well as Azure starting October 14, 2022, for those partners looking to migrate before general availability, which is January 2022. Our Microsoft dedicated associates can help guide you through the best solution to transition to this change.
Things to consider and know before the change:
1. Microsoft Partner Agreement (MPA) and Microsoft Customer Agreements (MCA) will not need to be re-signed for NCE
Microsoft has recently updated their MPA (Microsoft Partner Agreement) as of October 1, 2021, to reflect feature releases for NCE Seat Based offers. For partners who have already accepted the MPA prior to the October updates, the updated MPA will be effective on April 1, 2022. They will not need to accept the agreement again. For partners that accept the updated MPA on or after October 1, 2021, the updated terms will be effective immediately.
The Microsoft Customer Agreement (MCA) will not have to be re-signed to transact through NCE. However, similar to CSP, all NCE subscriptions will need to have an accepted MCA to transact through Ingram Micro Cloud Marketplace.
2. Microsoft NCE FY22 incentives will earn incentives differently from CSP
Microsoft’s newly adjusted FY22 incentives starting October 1, 2021, through September 30, 2022, will have newly adjusted incentives for indirect resellers for both CSP and NCE. Partners who transact in CSP will need to have a minimum CSP revenue threshold of $25,000 USD trailing twelve months to successfully earn core incentives and strategic accelerators for both Modern Work and Dynamics—earning split 60% Rebate /40% Co-Op. FY22 incentives for NCE, however, will require no minimum revenue threshold to earn incentives: MW and Dynamics Core incentives are +0.25-1% (relative to CSP), and the indirect reseller will only earn 100% Rebate (No Co-Op). For partners wavering under $25,000 USD TTM, we recommend switching to NCE earlier to increase their earning opportunity.
Partners will no longer earn incentives for CSP legacy subscriptions as of January 1, 2023.
3. Converting existing CSP subscriptions to NCE
We recommend converting subscriptions to NCE on the same date. To avoid different anniversary dates for different subscriptions under a customer, the best advice is to move all subscriptions over at the same time so you have little to no variance. Ingram Micro Cloud can support your business transition through white-glove services to aid in the migration - free of cost to you.
4. Adjust your terms and conditions with NCE legal counsel
To expand upon resources on the legal-front, Ingram Micro Cloud has teamed up with IT Agree incorporating legal counsel and term discussion around the New Commerce Experience agreements. Ingram Micro Cloud has worked closely with IT Agree to provide a proper framework around how partners can build out their agreements to cover any financial risk or liability around New Commerce Experience for products like Modern Work, Dynamics 365 and Azure. Simply log onto Cloud Marketplace and find their solution in our catalogue.
5. Questions around NCE?
Register for our Monthly Microsoft ChannelTalk Webinars where we will review Microsoft CSP changes that affect all three clouds: Register here. Here you can pose your questions to our speakers or get in touch with our dedicated Microsoft associates for one-on-one attention.
Learn more about updates and changes through our dedicated Microsoft NCE landing page with resources to help you go to market and more: https://now.ingrammicrocloud.com/nce.