Understanding the New Commerce Experience for Microsoft Azure

Microsoft launched the new commerce experience for Azure in the Cloud Solution Provider program (Azure plan) in November 2019. At that time partners were informed that the previous Azure offer and platform would continue to be available, alongside the new Azure experience, for some time.

“We want to give partners time to incorporate the new Azure features with their services and transition their customers to the new experience… we will be taking a phased approach to… [ensure we are] delivering the key benefits of new commerce in the Cloud Solution Provider program with minimal disruption(1),” explained Dan Truax, GM Partner Digital Experience & Program, Microsoft.

Phase 1 is set to go live on 21st July 2021, so we’ve collated a list of useful resources to help you understand the benefits and any potential impacts to your business. Furthermore, our Dicker Data Microsoft licencing team are on-hand to support with 1:1 consultation to support your through this first phase. Request a call back here.

What is the New Azure Plan?

The new Azure commerce experience (aka New Azure Plan) streamlines and consolidates the way partners buy and consume Azure services for customers. It is designed to support partners in providing guidance, value-added services and help customers commit to Azure, helping service providers grow their business and drive customer success with a new commerce experience.

Specifically, partners gain access to Azure services at pay-as-you-go rate for customers under the Microsoft Customer Agreement, through an Azure plan. This plan simplifies the purchase experience by enabling the creation of multiple Azure subscriptions within an Azure plan. There is no longer a need to submit a separate order per Azure subscription in Partner Centre.

A side by side comparison of the plans: 

*Download the full guide here. 

What does Phase 1 mean for Microsoft Azure partners? 

In Phase 1, all new Azure Cloud Solution Provider program business will be on the new Azure plan offer. This means: 

• For all existing reseller relationships between partners and customers in the Cloud Solution Provider program, if the customer has already purchased the previous Azure offer, the partner may continue to transact, and the customer may continue to purchase the previous Azure offer from that partner.
• The previous Azure offer will no longer be available to net-new partners transacting in the Cloud Solution Provider program.
• The previous Azure offer will no longer be available to net-new customers purchasing via a partner in the Cloud Solution Provider program.
• For all new reseller relationships or new customer acquisitions, partners can only transact the new Azure offer (Azure Plan).
• For all existing reseller relationships between partners and customers, if the customer has never purchased Azure before, the partner may only transact, and customer may only purchase the new Azure offer from that partner.

If you are looking for more information n any of these points, reach out to our licensing team here. 

Benefits of operating in the New Azure Plan

If you are considering whether you should move your existing customers to the New Azure Plan, some of the benefits you can expect:

Easier customer management

The Azure Plan simplifies the partner’s purchase experience since a partner can create multiple Azure subscriptions under one Azure Plan. The Azure plan is essentially a container for all customer Azure subscriptions. In this model, there can be only one Azure Plan per partner, but you can add multiple Azure subscriptions under a single Azure Plan.

Clear, transparent pricing

The current pricing structure for Azure can be complex and varied. It can be challenging for partners and customers to understand the pricing structure, especially when you consider the thousands of services in Azure and the multiple options to buy. The new Azure Plan is aligned to a single global pricing model consistent across all channels. This means partners can offer Azure at published prices to customers. Doing so provides greater visibility to customers and builds trust.

While the price list is in USD, if you are in Australia you will be billed in your local currency using a monthly FX provided by Microsoft. The Azure plan also provides a clear billing cycle following a normal calendar month, giving partners a consistent and predictable view of Azure pricing across sales motions and billing dates.

Managing your costs with Azure

With the introduction of Cost Management for CSP, partners can leverage the native Azure tool to create reports and insights for all their customers making managing multiple customers much easier.

This tool is designed to track and control costs, prevent overspending and increase usage predictability. It can optimise virtual machines; ensure they are the correct size for your customers’ needs and identify when VMs are not being used in order to remove them. The goal is to save money and make sure you and your customers’ only pay for what is used.

Some of the key features available include:

• Customisable Dashboard
• Ability to manage cloud spending
• Automated cost analysis reporting (analyse costs by customer, subscription, resource group, resource, meter, service, and many other dimensions.)
• Usage alerts (budget and spend)
• Resource tagging
• Cost optimisation tools

Partner Earned Credit (PEC) in the new commerce experience

In the New Azure Plan, the standard discount from Microsoft on the Classic Azure is replaced by Partner Earned Credit (PEC) which is equivalent to the resale margin you previously received on Classic Azure.
Microsoft wants to reward partners who add value on top of Azure by providing value-added services on an ongoing basis and generate sustainable profitability.

Partners provisioning new Azure subscriptions can be assigned AOBO rights by Dicker Data to perform administrative tasks on the customer’s Azure AD tenant on behalf of the customer.

Where can you learn more? 

OnDemand short training modules can be accessed here. These snackable videos cover off a range of topics and are specifically targeted to CSP partner sellers. Additional curated resources can be accessed on Microsoft Partner Network here.

Footnote (1) https://blogs.partner.microsoft.com/mpn/evolving-the-azure-offer-in-the-cloud-solution-provider-program/