Will You be Forced to Use a Microsoft CSP?

Discontinuing Microsoft Software Assurance is no longer an option

Microsoft is significantly advancing its cloud services by transitioning their existing customer base to Office 365, Exchange Online, and the various Azure offerings. It also involves upselling existing cloud customers on a broader range of services. The most notable of these is Microsoft 365, a suite of Office 365, Windows (client), and Enterprise Mobility + Security (“EMS”).

Yet another strategy has emerged as Microsoft seeks to ramp up its smaller customers. Small businesses needed the computing power and the applications Microsoft offered, but the small businesses lacked the technical resources to do manage the installations on their own. These organizations have now opted for Office 365 and other cloud services as a worry-free alternative.

This new strategy is the Cloud Solution Provider or “CSP” program. Microsoft has extended the CSP program to its existing partners as a way to grow, citing the partner’s relationship with the customer, longer-term agreements, predictable costs, and increased revenue. Essentially, these partners become indirect resellers of Microsoft’s cloud services. Initially, at least, the terms of the CSP program are very favorable to the partner, with terms like a single seat to start, the ability to add or subtract seats on a monthly basis, and incentives in addition to the partner’s margin.

So what is Microsoft’s motive? Beyond wanting a bigger piece of the overall cloud market, there are other factors at play. The first is to drive continual revenue through subscriptions. The ability for a customer to reduce its spend on Microsoft by discontinuing Software Assurance is no longer an option. Second, the maintenance of Microsoft-hosted solutions is controlled by Microsoft. This can help reduce the costs associated with technical support by limiting the number of supported product versions in the field.

Is the cloud right for your organization? There’s more to it than we’ve covered here. Contact Miro Consulting to discuss your current state as well as your future plans and objectives.