Here's the 411 on upcoming Microsoft CSP licensing and pricing changes

Here’s the 411 on upcoming Microsoft CSP licensing and pricing changes:
Plus, 3 ways SHI can save you money and help stretch your Microsoft budget.

Posted November 12, 2024

Reading Time: 3 minutes

Microsoft has announced two upcoming modifications to licensing and pricing structures for online services within their Cloud Solution Provider (CSP) program. These changes will take effect in late 2024 and early 2025, so it’s time to start planning for these new pricing models.

As a Microsoft partner with 35+ years of experience helping organizations select, deploy, manage, and optimize their Microsoft licensing and environments, SHI has the expertise to guide you through these changes.

From what we’re seeing, Microsoft is aiming to give you more flexibility with Copilot, but there’s a catch…

Change #1: A new monthly billing option for Microsoft 365 Copilot in CSP

Effective December 1, 2024, Microsoft will introduce an annual subscription term with a monthly billing option for Microsoft 365 Copilot within the CSP program. Currently, the only way for CSP customers to access Copilot is via an annual subscription term with an annual billing option, so this new option will allow organizations to opt for more flexible payment terms.

However, this new annual term/monthly billing option will be priced at a 5% premium over the existing annual term/annual billing option.

Change #2: Price increase for all annual term/monthly billing CSP SKUs

Effective April 1, 2025, Microsoft will also increase pricing by 5% for all annual term/monthly billing online services SKUs in the CSP program. This is a change from the current model, which bills organizations at the same price regardless of whether they choose annual or monthly payments.

Understanding the impact on your CSP environment

These changes will require budget adjustments and new purchasing strategies for organizations that have previously selected monthly invoices.

For instance, if you’re currently on a monthly billing cycle for Microsoft 365 E3 with 500 users, you could be looking at an extra $10,000 per year.

These price increases could also significantly impact your organization’s current and future IT subscription expenditures.

How SHI can help

At SHI, we understand that navigating changes in licensing and pricing structures can be challenging. Our team of experts is here to help you make sense of these changes and develop strategies that minimize the impact on your organization. We can assist in three ways:

1. Comprehensive licensing reviews

SHI’s Microsoft experts will evaluate your current agreement and identify potential savings, ensuring you’re not overspending with the new pricing model. Our licensing reviews include a detailed analysis of your current usage, identification of potential redundancies, and recommendations for right-sizing your licenses to the new pricing model.

2. Budget planning and forecasting

Effective budget management is key to absorbing price increases. SHI’s consultants will work with you to develop a proactive budget strategy that accounts for these changes and avoids any surprises down the line.

3. Ongoing support and consultation

These upcoming changes to Microsoft 365 Copilot licensing and CSP subscriptions may feel overwhelming.

If you decide to avoid the cost increase of monthly billing and switch to an annual billing model, we’ll help you navigate these changes smoothly during your subscription renewal. We’ll also provide ongoing support and consultation so you can adapt to future licensing changes with as little disruption as possible.

Our team is here to ensure a smooth transition and continued success for your organization. Whether you need a comprehensive review of your current environment, assistance with budget planning, or general ongoing support through this transition, we’re here for you.