What is NCE? With rapid increases in businesses globally transferring their data to some of Microsoft’s Cloud-based products, we wanted to talk about some changes that are coming to Microsoft surrounding how they bill their cloud subscription services such as Microsoft 365. Microsoft has previously run a platform called Microsoft Cloud Solution Provider Programme (CSP) by which organisations have the ability to provision and access Microsoft Cloud Solutions for example: Office 365/Microsoft 365. This platform will be replaced by Microsoft’s New Commerce Experience which is in line with similar changes that occurred with Microsoft Azure, this intended to reduce complexity and offer cost savings for long term commitments. So, what does this mean for your business? Microsoft have also announced that from March 2022, businesses that use Microsoft services such as Microsoft 365, Windows 365, Power Platform, and Dynamics 365 will be facing a 10-25% price increase. We are currently still waiting for exact price changes which are expected in the first few weeks of February which we will update accordingly. The Microsoft online services that will be affected include but may not be limited to:
Microsoft 365 Business Basics
Microsoft 365 Business Premium
Office 365 E1, E3, E5
Microsoft 365 E3
We can all agree that a price increase is never greeted with open arms, however with the thousands of new updates and features that Microsoft have been implementing for better experiences in the new hybrid working environment, I think it is safe to say these changes will be worth it in the long run. Microsoft’s investment in the teams platform alone has helped hundreds of thousands of business communicate through the pandemic. The key dates you should be aware of are: 10th January 2022 – NCE launches, and Microsoft will release their introductory promotions. It’s advised that you look at committing to the new subscriptions to leverage the discounts available. 1st March 2022 – The price increases across Microsoft 365 licences come into place. From March all new and renewing subscriptions will be purchased through NCE. 1st October 2022 – All customers will now have to purchase through NCE. 3 types of subscriptions under Microsoft’s NCE: One of the most substantial changes regarding the switch to NCE is there will no longer be pro-rata refunds offered with cancelled licenses. Organisations can currently purchase licenses on fixed 12-month subscriptions (paid annually/monthly) with the specific quantity of licenses needed. Now, on this CSP model, organisations have had the flexibility to scale their licenses accordingly as well as being issue with any pro-rata refunds any licenses cancelled before the end of their term. Following the new switch to NCE, the refunds won’t be available, organisations will be given a 72-hour window to cancel after purchasing. Once this timeframe has passed, the amount of licenses originally specified will be in place for the full duration of the subscription.
| 1 month subscription | 12 month subscription | 36 month subscription |
Billing terms | Monthly | Monthly & Annually | Monthly, Annually & prepay |
Pricing | 20% increase over 12 month subscription | Standard | Standard |
Cancellation/Adjustment window | 72 hrs | 72 hrs | 72 hrs |
Commitment | Flexible | Fixed | Fixed |
Seat changes | Increase always. Decrease always. | Increase always. Decrease within cancellation/adjustment window | Increase always. Decrease within cancellation/adjustment window |
Benefits | Flexible | Cost savings & price lock for 12 months | Cost savings & price lock for 36 months |
How can we help?
The team here at Total IT want to support our clients in navigating these new changes, we recommend speaking to our specialist team before1st March 2022 so that we can help you to leverage the discounts that are available at this time.
This change is also a good opportunity for auditing your current licenses and making sure you’re not paying for anything that you are not using, we will work with you to discuss options and tailor solutions to best fit your organisation and goals.
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