Microsoft Enterprise Agreement Discount Levels

The potential downside of signing up for an EA is that an organization could „overdo“ its software, Horwitz warned. Microsoft offers EAs from levels „A“ to „D“. Businesses get a 20 percent discount from Level A if they have a Level D subscription, he explained. Microsoft has also changed the way EA desktop discounts are counted. Previously, they were counted on the basis of the number of qualified offices. Now, with the July change, they are counted on the basis of „the largest quantity of licenses ordered from one in four price groups“ (see chart). According to Horwitz, the formula aims to incentivize the purchase of online services in an EA. Microsoft has removed the option to extend for one year (it`s now a three-year extension period). In addition, the discount level may vary during an EA subscription. A new change to the July agreement is that users can now change the product range at the time of renewal. This was previously prohibited under Microsoft`s EA agreement, Horwitz noted.

On October 1, 2018, Microsoft removed programmatic discounts for A-level customers on EA (customers between 250 and 2399 seats). Without these built-in discounts, EA doesn`t offer higher prices than other volume licensing programs without your Microsoft team taking care of negotiating your discounts. EA pricing is now very much on par with other programs like CSP, which have much lower minimum requirements to launch the deal. For similar pricing, companies should start seriously evaluating ea`s pros and cons compared to other options. For example, an EA has more complex contract paperwork, high annual advance fees, and minimal flexibility to reduce your subscriptions. Even if your company qualifies for an EA and has more than 500 jobs, these changes could prompt you to look for other options. Both agreements have advantages and disadvantages and are not a one-size-fits-all, but these recent changes may force companies to consider other alternatives. At the end of the day, while EA`s qualified companies can make sense of pricing, they still have to expect to pay upfront each year and don`t have the option to reduce the number of subscriptions in the middle of the year. However, it`s worth having all your products, both in the cloud and in the field, in one agreement. EA is a great option for this, but with distant programmatic reductions, the benefits diminish over CSP. The aspects that used to make ea hard to deny no longer exist, especially for users with fewer than 500 seats. It would be worthwhile for companies to at least do their homework when it comes to alternatives.

For companies that employ more than 2,400 people, Microsoft offers an additional programmatic discount that would widen the gap. Changes in JulyA new change in the EA is that the true-up response time has been shortened. Microsoft requires an organization`s review to be completed in 60 to 90 days, Horwitz said, so that change can affect a company`s asset management and IT budgeting activities. A true-up is how Microsoft`s EA agreements consolidate license purchase. During true periods, customers participate in a software audit and pay for each additional usage. We`re seeing a growing number of organizations preparing to renew their Office 365™ Enterprise Agreements (EA) and much higher prices from Microsoft® than before. There are a number of reasons for this, but it`s important to note that if you`ve gotten deep discounts on your existing deal, it doesn`t necessarily mean you`re getting it again. Microsoft has spoken publicly about its desire to relocate its customers to the cloud, and Office 365 is often the first step. They use several ways to convince users to give up their permanent licenses, including tactics such as refusing to negotiate discounts for open-ended deals, or at least negotiate at a minimum…

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