Microsoft CSP explained: Is It Right For You?

Introduction

In the rapidly evolving world of IT, staying ahead is not just a strategic advantage; it’s often a necessity. As an IT professional in charge of the digital infrastructure for a medium or large enterprise, you understand the importance of making the right technology choices.

This comprehensive guide explores the Microsoft Cloud Solution Provider (CSP) program, a flexible Microsoft licensing program for organizations. We’ll dive deep into the CSP program, shedding light on the process of purchasing through CSP, differences between indirect and direct CSP models, advantages and disadvantages, the intricacies of CSP Direct Bill, the new CSP New Commerce Experience (NCE), comparing CSP and EA, how to find the right CSP Partner, the range of products available and much more. Read through this article and find an FAQ at the end.

 

Microsoft’s CSP Program: What is it?

The Microsoft Cloud Solution Provider (CSP) program is a comprehensive licensing agreement introduced by Microsoft in 2015. It offers businesses the ability to procure Microsoft cloud services and software licenses directly from authorized Microsoft partners. If you’re considering adopting Microsoft cloud solutions, understanding the CSP program is essential.

The CSP program provides flexibility, allowing you to customize your licensing (for example) on a month-by-month basis. This means you can easily add or remove licenses as your business needs change. With one point of contact for support and billing, you’ll have a streamlined experience and access to additional services and expertise offered by the CSP partner.

 

Advantages of Microsoft CSP

The Microsoft CSP program offers considerable advantages:

  • Flexibility Beyond Measure: One of CSP’s standout features is its unparalleled flexibility, perfectly tailored to the unpredictable demands of modern enterprises. With a pay-as-you-go model, you only pay for the resources you consume. Whether you need to scale up or down, this flexibility ensures that you’re not saddled with unnecessary costs. Read more below.
  • Streamlined Management: Efficiency in managing digital assets is a cornerstone of IT success. The CSP program consolidates critical administrative tasks into a user-friendly interface, covering everything from updates and user access to billing and provisioning. This streamlining significantly reduces operational overhead, allowing your IT teams to focus on strategic initiatives.
  • Access to Cutting-Edge Services: Remaining competitive today means staying at the forefront of technology. CSP grants you early access to Microsoft’s latest features and tools as they’re released. This strategic advantage ensures that your enterprise is equipped to adapt quickly to emerging trends and maintain a competitive edge.
  • Cost Optimization at its Best: Cost optimization while maintaining operational excellence is a constant challenge. CSP provides detailed insights into your billing, helping you monitor and optimize cloud expenses effectively. This ensures that your IT budget is used efficiently, enabling you to allocate resources strategically and maximize your return on investment.
  • Expert Support: Navigating the complexities of the digital landscape requires expert guidance. Authorized CSP partners are equipped to provide tailored insights, recommendations, and solutions aligned with your organization’s goals. This ensures that you always have the support you need to succeed.

 

Disadvantages of Microsoft CSP

While the Microsoft CSP program offers flexibility and benefits for businesses, it is important to consider the limitations and disadvantages that come with it. Understanding these drawbacks can help you make an informed decision for your organization’s licensing needs.

  • Limited Product Availability: Not all Microsoft products and services are available through the CSP program. This can be a disadvantage if your organization relies on specific software or cloud solutions that are not offered in the CSP program. It is crucial to review the available products and licenses in the CSP program to ensure they meet your organization’s needs.
  • Differences in Licensing Terms and Conditions: The licensing terms and conditions in the CSP program may differ from other licensing channels, such as the Enterprise Agreement. This can create complexities and discrepancies when managing your software licenses and subscriptions. It is vital to carefully review and compare the licensing terms and conditions to ensure they align with your organization’s requirements.
  • Limited Discounts for Larger Organizations: The CSP program may not offer the same level of discounts as the Enterprise Agreement, especially for larger organizations. If your organization requires significant volume discounts for software licenses, the CSP program might not be the most cost-effective option. It is important to consider your organization’s size and licensing needs when evaluating the potential cost-savings of the CSP program.
Disadvantages Impact
Limited Product Availability Potential need for alternative software or cloud solutions
Differences in Licensing Terms and Conditions Management complexities and discrepancies
Limited Discounts for Larger Organizations Potential higher costs for software licenses

Although the CSP program has its limitations, it still provides significant benefits that appeal to many organizations. It is crucial to thoroughly evaluate your organization’s needs and compare the advantages and disadvantages of the CSP program before making a decision.

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Understanding CSP Models: Indirect vs. Direct

Understanding the differences between the two primary CSP engagement models, indirect and direct, is crucial for making an informed choice.

  • Indirect CSP: In this model, you partner with an intermediary, known as an indirect provider, who bridges the gap between your organization and Microsoft. Indirect providers manage key aspects of the CSP engagement, including billing, provisioning, and support. This collaborative approach offers high levels of support, expertise and helps organizations cut costs.
  • Direct CSP: In contrast, direct CSP involves your organization entering a direct contract with Microsoft. Here, you take on a more hands-on role in managing the CSP relationship. You are responsible for billing, provisioning, and supporting Microsoft services internally. This model provides greater control and autonomy over your CSP engagement.

 

How CSP works, step-by-step

Understanding how the CSP program works is essential for a smooth implementation. Here is a step-by-step guide:

  1. Step 1: Choose a Microsoft CSP partner: Select a trusted Microsoft CSP partner that aligns with your business requirements and has the necessary expertise in the cloud services and Microsoft products you need.
  2. Step 2: Define your licensing needs: Determine the Microsoft cloud services and software licenses your organization requires. Work with your CSP partner to understand the available products and licenses in the CSP program.
  3. Step 3: Sign the Microsoft Customer Agreement (MCA): Upon selecting a CSP partner, sign the MCA, which serves as the licensing agreement between your organization and Microsoft. The MCA outlines the terms and conditions of your licensing agreement and serves as a foundation for the CSP program.
  4. Step 4: Procure licenses through your CSP partner: Work with your CSP partner to procure the necessary Microsoft cloud services and software licenses. Your CSP partner will assist you with the licensing process and provide support for any inquiries or issues.
  5. Step 5: Manage your licenses through the Partner Center: The Partner Center is a portal that allows you to manage your licenses and access additional benefits and resources. Use the Partner Center to monitor and control your licensing activities.
  6. Step 6: Utilize additional services and support: Take advantage of the additional services and support offered by your CSP partner. They can provide expertise, managed services, and valuable insights to help you maximize the benefits of the CSP program.

By following this step-by-step guide, you can effectively navigate the CSP program and leverage its benefits for your organization.

 

MCA as a CSP Requirement

The Microsoft Customer Agreement (MCA) is a vital requirement for participating in the CSP program. By signing the MCA, you establish a licensing relationship between your organization and Microsoft. It serves as the foundational licensing agreement between you and Microsoft to facilitate the procurement of Microsoft services. The Microsoft Customer Agreement defines the usage rights for online services and Azure services acquired through Cloud Solution Provider (CSP).

The MCA is not exclusive to the CSP program; it is also utilized for purchasing Microsoft services through other channels. This means that signing the MCA opens up opportunities beyond the CSP program, allowing your organization to leverage Microsoft services in various ways.

The MCA outlines the terms and conditions of your licensing agreement, ensuring transparency and providing clarity for both parties involved. It sets forth the rights, responsibilities, and obligations of your organization and Microsoft, serving as a legal document that governs your licensing relationship.

Signing the MCA is a critical step in joining the CSP program and unlocking the potential of Microsoft services for your organization. It establishes a clear framework that governs your licensing agreement, ensuring a solid foundation for your journey with Microsoft.

The Significance of MCA in the CSP Program

The MCA holds significant importance within the CSP program. It provides the framework that enables your organization to procure Microsoft cloud services and software licenses from authorized CSP partners. By signing the MCA, you gain access to an array of benefits and support offered by Microsoft and its partners, empowering your organization to leverage cutting-edge technology and drive business transformation.

The MCA also plays a crucial role in fostering trust and transparency between your organization and Microsoft. It outlines the rights and responsibilities of both parties, ensuring a mutually beneficial relationship built on a strong contractual foundation.

Furthermore, the MCA establishes clear guidelines for billing and invoicing, ensuring clarity and a streamlined process for managing your licensing agreements. This transparency enables you to accurately track your licensing usage and costs, leading to better financial management and optimization of resources.

 

CSP Subscription Options

The CSP program offers flexible subscription options to meet the needs of your organization. You can choose from the following subscription plans:

1. Monthly Subscription

With the monthly subscription option, you pay for your Microsoft cloud services on a month-to-month basis. This subscription option provides you with the flexibility to adjust your usage and licensing requirements as needed. Your monthly invoice is based on your actual usage, allowing for greater control over your expenses.

2. Annual Subscription

An annual subscription allows you to commit to Microsoft cloud services for a full year. This option provides the benefit of monthly billing, spreading out your payment over the course of the year. By committing upfront, you can also take advantage of potential cost savings compared to the monthly subscription. It is a great choice if you have long-term usage requirements or prefer predictable monthly billing.

3. 3-Year Subscription

The 3-year subscription is similar to the annual subscription but with a longer commitment. This option is available for some Microsoft products and services and is ideal for organizations that require stable and long-term licensing. However, it’s important to note that the 3-year subscription does not offer a monthly billing option for server subscriptions, so consider this when choosing your subscription plan.

When selecting a CSP subscription option, consider your organization’s budget, usage patterns, and long-term licensing needs. In consultation with your Microsoft CSP partner, choose the subscription plan that aligns best with your requirements and provides the most value for your organization.

 

CSP Direct Bill: A Closer Look

CSP Direct Bill is a model in the Cloud Solution Provider (CSP) program that allows registered Microsoft Partners to purchase Microsoft products and subscriptions directly from Microsoft and sell them directly to their customers through their in-house sales staff. CSP Direct Bill partners need to meet certain requirements, such as providing the first level of cloud product support to their customers, having a Microsoft support plan, meeting a revenue threshold, and having the organizational infrastructure to manage customer billing and provisioning. For this reason, CSP Direct Bill-enabled Microsoft Partners in Europe are very rare.

Benefits of CSP Direct Bill compared to CSP indirect

  • More direct and personalized relationship with the partner: The customer can communicate directly with the partner who purchases and resells Microsoft products and services, without involving a third-party distributor. This may allow for more customized solutions, faster response times, and better alignment of goals and expectations.
  • More control and flexibility over billing and provisioning: The customer can receive invoices and manage subscriptions directly from the partner, without relying on a distributor’s platform or processes. This may give the customer more visibility and autonomy over their cloud spending and usage.

 

CSP New Commerce Experience (NCE): Replacing the old CSP

Microsoft introduced the New Commerce Experience (NCE) in early 2022, bringing about several changes to the CSP program for businesses. NCE is set to replace the former CSP in 2024. The most significant change is related to price protection, which now hinges on the duration of the CSP subscription. Adjustments during the subscription period are considerably more challenging with NCE.

Microsoft has also extended NCE to educational institutions (Education) and non-profit organizations (Charity) at the end of 2023.

Microsoft CSP vs. EA

When it comes to choosing a licensing model for your organization’s Microsoft products and services, two popular options are the Microsoft Cloud Solution Provider (CSP) program and the Enterprise Agreement (EA). Each model offers its own set of advantages and considerations that are important to understand before making a decision.

Microsoft CSP

The Cloud Solution Provider (CSP) program aims at customers of all sizes who want to buy Microsoft online services on a highly flexible transactional basis. There is no minimum requirement for online services subscriptions, and consumption-based billing for Azure services without commitment. CSP is the perfect program for short term projects, small and medium sized companies or customers who want to flexibly shift to Microsoft online services.

In addition to online services you can also buy on-premises software as perpetual licenses or subscriptions through the CSP program.

The Microsoft CSP program provides businesses with greater flexibility compared to the EA. With CSP, you have the ability to adjust your licenses on a monthly basis, allowing you to easily add or remove licenses as needed. This ensures that you only pay for what you use, making it a cost-effective solution.

Advantages of the CSP Program

  • Licensing Flexibility: The CSP program operates on a month-to-month billing cycle, allowing organizations to easily adjust their license quantities as needed. This provides the flexibility to scale up or down based on business requirements.
  • Additional Support and Services: With the CSP program, organizations have access to dedicated support and additional services through their CSP partner. This ensures a high level of assistance and expertise when managing Microsoft products and services.
  • Billing Convenience: The CSP program offers consolidated billing, providing a single point of invoicing and support for all Microsoft cloud services and software licenses. This simplifies the billing process and streamlines financial management.

 

Enterprise Agreement (EA)

On the other hand, the Enterprise Agreement is a more traditional licensing model with a minimum three-year commitment. This model is often recommended for medium to large organizations with stable license requirements and a predictable IT budget. It is available for organization purchasing Microsoft licenses for 500 users and more.

One of the main advantages of the EA is the scaled volume discounts it offers. The larger your organization, the bigger the discount you can receive on your Microsoft licenses. Also, these discounts are negotiable. This can result in significant cost savings for organizations with a large number of users.

Advantages of the EA

  • Fixed Pricing Structure: The EA provides a fixed pricing structure for a minimum three-year commitment, offering stability and predictable costs for organizations with stable license requirements. It also allows for volume discounts based on the number of licenses.
  • License Management: The EA provides organizations with centralized license management, making it easier to track and control software usage across the entire organization. This enables efficient license allocation and compliance.
  • Enterprise-level Features: The EA is specifically designed for larger organizations, offering enterprise-level features such as Software Assurance benefits and deployment planning services. These additional features cater to the unique needs of large enterprises.

 

 Microsoft EA Microsoft CSP
Contract Length Three years Month-to-month
Pricing Structure Fixed pricing with scaled volume discounts Flexible pricing based on monthly usage
Licensing Flexibility Adjustments require true-up process License adjustments as needed
Support and Services Includes support and services from Microsoft Additional support and services through CSP partner

 

Choosing the Right Model

When deciding between the Microsoft CSP program and the Enterprise Agreement, it is essential to consider your organization’s specific needs and preferences. If flexibility and the ability to adjust licenses on a monthly basis are important to you, the CSP program may be the better option. On the other hand, if your organization has stable license requirements and can benefit from scaled volume discounts, the EA might be more suitable.

Ultimately, the decision should be based on careful consideration of your organization’s usage patterns, budget, and long-term goals. Consulting with a trusted Microsoft CSP partner can also provide valuable insights and guidance in selecting the right licensing model.

 

Migrating to CSP from an EA

If your organization is currently using an Enterprise Agreement (EA) and considering migrating to the CSP program, it is important to understand the process. Migrating to CSP allows for more flexibility and a pay-as-you-go model. Before making the transition, evaluate your current licensing needs and consult with a Microsoft CSP partner. They can guide you through the migration process and help ensure a smooth transition from the EA to the CSP program.

Finding the right Microsoft CSP partner can help you navigate these limitations and maximize the benefits of the CSP program. The expertise and support from a trusted partner can ensure a smooth transition and efficient management of your licenses and subscriptions.

Remember to consider all the factors and limitations of the CSP program to determine if it aligns with your organization’s needs and goals.

 

Finding the Right Microsoft CSP Partner

When it comes to leveraging the benefits of the Microsoft CSP program, finding the right partner is crucial for a successful engagement. To ensure a seamless experience, you need a partner that aligns with your business requirements and possesses the necessary expertise in cloud services and Microsoft products. Here are some key factors to consider when choosing the right CSP partner:

  1. Level of Support: Look for a partner that provides excellent customer support and is readily available to address any concerns or issues that may arise during your engagement. A responsive and knowledgeable support team can greatly enhance your experience with the CSP program.
  2. Managed Services Capabilities: Consider whether the partner offers managed services that can help optimize your cloud infrastructure and ensure smooth operations. These services can range from monitoring and maintenance to proactive problem-solving, freeing up your internal resources.
  3. Industry Experience: Evaluate the partner’s experience in your specific industry. A partner with expertise in your sector can better understand your unique challenges and requirements, offering tailored solutions that add value to your business.
  4. Cost of Consultancy: Different partners charge different fees for their software consultancy. These can amount to significant costs and may be hard to predict. Therefore, it might be wise to go with a partner, that offers free expert Microsoft consultancy services.
  5. CSP Purchasing Portal: Some partners, such as SCHNEIDER IT MANAGEMENT, have automatic web-portals, in which customers can purchase additional Microsoft CSP licenses with the click of a button. This saves time and gives a great user experience.
  6. Different Microsoft Licensing Programs: Partners, that offer several or all Microsoft licensing programs might be less biased in consulting you regarding Microsoft CSP. They have your best interest in mind and will recommend the best licensing option for your specific business case.

By researching and comparing different Microsoft CSP partners, you can find the ideal match for your business. Take the time to request proposals, schedule consultations, and evaluate the partner’s track record with similar organizations. Choosing the right Microsoft CSP partner sets the foundation for a successful and beneficial relationship under the CSP program.

 

Available Products in CSP

The CSP program provides access to a comprehensive suite of Microsoft solutions tailored to meet your organization’s specific needs. Key products available include:

  • Microsoft Dynamics 365: A robust platform for customer relationship management (CRM) and enterprise resource planning (ERP), enabling your organization to optimize customer engagement and streamline operations.
  • Microsoft 365 (formerly Office 365): A suite of productivity tools, including Word, Excel, PowerPoint, and collaboration services like Teams and SharePoint, designed to enhance communication and productivity within your enterprise.
  • Microsoft Azure: A leading cloud computing platform offering a wide range of services, including virtual machines, databases, artificial intelligence, and analytics tools, empowering your organization to innovate and scale in the cloud.
  • Microsoft Enterprise Mobility + Security (EMS): A comprehensive solution that enhances security and management of mobile devices, applications, and data within your organization.
  • Microsoft Windows 10 Enterprise: An advanced operating system designed to meet the security and productivity needs of large enterprises.

These products cover a broad spectrum of business-critical applications and services, ensuring that your organization can fully leverage Microsoft’s technology stack through the CSP program.

 

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Benefits of choosing SCHNEIDER IT MANAGEMENT as your CSP partner

We at SCHNEIDER IT MANAGEMENT are a CSP Direct Bill partner that has been providing Microsoft cloud solutions and services to customers for more than 11 years. As Microsoft Gold Partner, we have a team of certified and experienced cloud experts who can help you with licensing, deployment, and support of Microsoft products and services. We can provide you with all CSP program types and offer you free expert licensing consultancy. This way, you will find out, which licensing program is right for you and we will optimize your organization’s Microsoft licensing for you.

By choosing us as your CSP partner, you will benefit from:

  • Competitive pricing and flexible payment options: We offer attractive discounts and incentives for Microsoft cloud products and services. You can also choose to pay monthly or annually, depending on your budget and cash flow.
  • Personalized and proactive customer service: We have an experienced team of Microsoft experts that will provide you with regular licensing updates, reports, and recommendations to ensure your cloud environment is running smoothly and efficiently. We ensure, that you stay compliant and have the best conditions on your Microsoft licensing in CSP.
  • Free expert consultancy: Just give us a go by booking free expert licensing consultancy for your organization and see, what SCHNEIDER IT MANAGEMENT can do for you.
  • CSP Purchasing Portal: With SCHNEIDER IT MANAGEMENT’s automatic CSP-web-portal, you can easily purchase additional Microsoft CSP licenses with the click of a button. This saves time and gives a great user experience.
  • Microsoft Partner for a Decade: We have a great relationship with Microsoft and have experience with all Microsoft licensing programs. We are the first Licensing Solution Provider (LSP) in Luxembourg and have experience with the most complex, multi-country contracts from organizations of all industries.

Don’t miss this opportunity to transform your business with the power of the cloud. Contact us today and get started with Microsoft CSP!

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Conclusion

In conclusion, the Microsoft CSP program and the Enterprise Agreement (EA) provide different licensing models for organizations to consider. The CSP program offers flexibility, additional support, and a month-to-month billing cycle, making it ideal for businesses with varying license needs. On the other hand, the EA offers a fixed pricing structure and is better suited for organizations with stable license requirements.

When choosing the right licensing model for your organization, it is crucial to assess factors such as licensing flexibility, support services, and pricing structure. Consider the needs and goals of your business to align with the most suitable licensing model. Consulting with a Microsoft CSP partner can help you navigate through the options and find the best-fit solution for your organization.

By carefully evaluating the advantages and considerations of both the Microsoft CSP program and the EA, you can make an informed decision regarding your organization’s license management. Choose the licensing model that aligns with your business requirements and can support your growth and success moving forward.

If you need help with your Microsoft licensing, SCHNEIDER IT MANAGEMENT is here to support your organization’s digital transformation through the Microsoft CSP program. Reach out to us for free licensing consultancy regarding Microsoft CSP.

 

Microsoft Cloud Solution Provider (CSP) FAQ

What is the Microsoft Cloud Solution Provider (CSP) program?

The CSP program is a licensing agreement introduced by Microsoft that allows customers to procure Microsoft cloud services and software licenses directly from Microsoft partners.

What are the benefits of the Microsoft CSP program?

The CSP program offers deeper customer engagementsincreased profits, the ability to add value with tailored solutions, and the opportunity to provide managed services to meet customer demand.

What is the difference between a direct or indirect CSP?

In the indirect model, partners work with an official Microsoft indirect provider who assists with customer support and billing. In the direct-bill model, partners purchase products and subscriptions directly from Microsoft and sell them to their customers.

How does the Microsoft CSP program compare to the Enterprise Agreement (EA)?

The CSP program provides more flexibility with month-by-month billing and additional support from the CSP partner, while the EA offers a fixed pricing structure and larger volume discounts based on a minimum three-year commitment.

What are the disadvantages of the Microsoft CSP program?

Not all Microsoft products and services are available through the CSP program, and there may be differences in licensing terms compared to other channels like the EA. Additionally, the CSP program may not offer the same level of discounts as the EA for larger organizations.

How can I find the right Microsoft CSP partner for my business?

Look for a partner that aligns with your business requirements, has expertise in the cloud services and Microsoft products you need, and can provide additional value-added services and support.

Can you provide a step-by-step guide on how the CSP program works?

The first step is signing the Microsoft Customer Agreement (MCA), which establishes a licensing relationship between your organization and Microsoft. Then, you can choose from monthly, annual, or 3-year subscription options based on your budget and requirements. If you are currently using an EA, consult with a Microsoft CSP partner for guidance on migrating to the CSP program.

Is the Microsoft Customer Agreement (MCA) a requirement for the CSP program?

Yes, the MCA is required for the CSP program. It is the licensing agreement between Microsoft and the end customer, outlining the terms and conditions of the licensing agreement and serving as a foundation for the CSP program.

What are the subscription options available in the CSP program?

You can choose from monthly, annual, or 3-year subscriptions. Each option offers different billing and commitment terms, so you can select the option that best suits your organization’s budget and requirements.

How can I migrate from an Enterprise Agreement (EA) to the CSP program?

Before making the transition, evaluate your current licensing needs and consult with a Microsoft CSP partner. They can guide you through the migration process and help ensure a smooth transition from the EA to the CSP program.

What can be sold through the Microsoft CSP program?

The CSP program allows partners to sell Microsoft cloud services, including Microsoft 365 and Microsoft Azure, as well as a subset of server and desktop licenses. The available offers may change, so it is important to stay updated on the current offerings through the Partner Center Pricing Workspace.

What is the Microsoft Enterprise Agreement (EA)?

The EA is a traditional licensing model designed for companies with 500 seats or more. It allows organizations to purchase software licenses and cloud services for a minimum three-year period.

How does the Microsoft EA work?

The EA operates on a three-year contract basis with scaled volume discounts based on the size of the organization. Organizations can adjust their licenses and services through a process called “true-up” during the contract period. Scaling down can be challenging, as the deficit value is not recoverable if consumption is not met by the end of the first year.

What is the difference between the Microsoft CSP program and the EA?

The CSP program offers greater flexibility, additional support, and a month-by-month billing cycle. The EA offers a fixed pricing structure and is well-suited for organizations with stable license requirements. Consider licensing flexibility, support, and pricing structure to determine the best fit for your organization.

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