Admitted, the title of this case only will cause some difficulty to understand. But the case is not easy itself. Good to know: this case’ subject is about the Microsoft Volume License Agreements, not the Cloud Solution Provider or Service Provider License Agreement.

Enterprise Agreement and Subscription
Customers with at least 500 qualified devices or at least 500 qualified users can start the Microsoft Enterprise Agreement with an Enterprise or Enterprise Subscription enrollment. Such customers must initially order Enterprise Products (like Office Professional Plus or the Core or Enterprise CAL Suite) or Enterprise Online Services (like Office 365). They can mix and match to meet the business requirements. Those products must be chosen for every qualifying desktop or every qualifying user. Example: a customer has 750 devices with 750 users, they could choose for 500 traditional Office Professional Plus licenses and 250 Office 365 Enterprise E3 to meet the requirements.
However, if a customer decides to only select Enterprise Online Services they should only commit to the minimum number of 500 and they do not have to subscribe every qualified user for the service. In our example this means that the customer with 750 employees could enter only 500 subscriptions of Office 365 Enterprise E3 to the agreement.

Here is a screenshot for the Enterprise Agreement order requirements which explains the situation.

 

enterprise online services microsoft order requirements

 

Not for Small and Midmarket Customers
For SMBs the corresponding volume licensing agreements are the Open Value Company Wide (OV CW) and Open Value Subscription Agreements. Both agreement types lack the possibility to mix and match ‘platform products’ (perpetual licenses and online subscriptions). This is one downside for smaller customers.
The other drawback is that within Open Value CW and Open Value Subscription customer must subscribe all qualifying users to the Enterprise Online Service to meet the agreement requirements. The example; a customer with 150 laptops and 150 users. If this customer only needs 100 Office 365 subscriptions, this customer is not able to start an OV CW/OVS agreement with just these subscriptions. They are obliged to subscribe all 150 qualifying users to Office 365 as a platform product.

Slowing down cloud migrations
With the difference between what Microsoft grants to Enterprise customers (a lot) and SMB customers (not so much) Microsoft is slowing down cloud migrations for smaller customers. And again, every customer with less than 500 computers or employees is a ‘smaller customer’ in Microsoft’s perspective. The lack of ability to correctly license the cloud subscriptions holds customers back in their route to the cloud. Off course, there is always the Cloud Solution Provider program, but just bear in mind that a lot of SMB and Enterprise customers still have on premises IT solutions or want to use hybrid scenario’s. For that they will still need the Volume License Agreement and with that – the SMB customers – do not have the possibility to put all required licenses and subscriptions into just one agreement.

Discuss with Microsoft
Members of the Global Software Licensing Specialist Expert Circle are starting the discussion with Microsoft executives to find a solution for this problem. We will keep you informed on any progress in this case post. Do you have a contribution or do you want us to take some of your ideas to the software vendor? Please drop us a note.

Marcel Maul – SAM & Consulting Lead SFC Software for Companies
Erol Anil – CEO and Microsoft Volume Licensing Specialist Sycor IQ Solutions
Peter van Uden – Senior Licensing Associate Quexcel

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