Do standardized MPSA Subscriptions affect you?

After deciding not to move forward with the Microsoft Product and Services Agreement (MPSA) Enterprise Advantage option in September, even before it became available, Microsoft announced another change.

The Enterprise Advantage option was designed as a three-year agreement plan for organizations with 250 to 399 users or devices, meant to allow them to purchase both perpetual software and cloud services under one agreement. This aggregation would come with higher software pricing discounts.

As of April 1, 2017, Microsoft decided to standardize all online subscriptions for MPSA to one year or shorter. The decision was made to sustain and align the MPSA subscription duration to those in the Cloud Solution Provider Program and Microsoft Online Services Program.

Customers who purchased multi-year durations prior to April 1stwill keep their subscriptions unaltered and will still have the possibility to add users to those subscriptions with the same service end dates.

The exception to this standardization is Microsoft’s Windows E3 subscription option, which will still be available as a three-year subscription through the MPSA after 1st of April.

MPSA was a non-expiring agreement for commercial, government, and academic organizations with 250 or more users/devices who wanted transactional purchases of software and Online Services like Azure, Office 365 or CRM Online. Software Assurance was optional. Customers could purchase one, two or three-year Cloud Service subscriptions with a price-lock, even if the market price increased.

Since its introduction in 2014, MPSA suffered multiple changes. Nowadays, it is a perpetual agreement designed for large organizations with decentralized purchasing, where each group in the organization purchases their own licenses. The products available through the MPSA are also flexible. Organizations can purchase on premises perpetual licenses with or without Software Assurance, and/or online services such as Office 365. Azure is no longer available through MPSA though, since February 2017, and all online subscriptions are limited to maximum one year. On one hand, 1 – 11 month subscriptions are the perfect solution for seasonal or project based users, as they allow customers to pay only for what they need and when they need it.

On the other hand, this standardization pushes customers interested in multi-year subscription durations and price stability to the more rigid Enterprise Agreement.

Enterprise Agreement is a three-year agreement with a 500 minimum users/devices requirement that must also be enrolled in Software Assurance. It also requires that the company standardizes the entire software infrastructure to the latest versions of Office, Windows and/or Client Access Licenses which is called an enterprise-wide commitment for all qualified devices* and annual true ups**.

Although Microsoft declared that this change was meant to make buying choices easier, customers will in fact face the burden of one-year subscription prices which will most probably increase each year in contrast to a multiyear subscription where the price for the second and third year is at the first year’s level. Still, these are only assumptions and only customers can tell if this change benefits them or not.

*Qualified devices are generally defined as workstation computers capable of functioning as general-purpose computing devices, as opposed to task-specific/ line-of-business machines.

**True ups are an inventory of all the qualified desktops, users, and processors added to your organization over the course of the year, along with any additional product use requiring a license from Microsoft.