Microsoft New Commerce Experience – 1st Observations

by | Jan 17, 2022 | Announcements

If you are a Microsoft Office 365 (or Microsoft 365) subscriber, you must have heard about NCE. Microsoft calls it New Commerce Experience. As a Microsoft Partner, we are compelled to follow the transition and move our clients to the new NCE model. 

But, before Microsoft Partner, as an MSP, we consider ourselves as a Client Partner and we are disappointed with this new model being forced upon by Microsoft, especially on small businesses. 

First, there is a price increase on the cards, where some SKU will be 15%-20% more expensive from March 2022. Subscriptions, most used by small businesses such as Business Basic are made more expensive.

In a nutshell, changes are as follows:

1. Pricing is going up by up to 20% on Microsoft Business Basic, Premium, and a number of Enterprise M365 subscriptions.

2. Under NCE, you will have to buy and pay for either an annual commitment or a monthly commitment. Monthly licenses will be expensive. With the upcoming 15%-20% price increase, for some SKUs, customers will have up to a 30%-40% price increase, if they opt for a monthly commitment.

3. Under the CSP model, when you work with a partner, you only pay for what you used. All that flexibility is now gone with NCE. If you get a temporary staff for 15 days, you will pay for a month’s charge on that license. If you get a temporary staff for 3 months, you pay 20% more due to a monthly subscription.

This is also a risk to small MSPs as a client can opt for an annual commitment but choose to pay monthly – and if their business hits turbulence, you won’t get paid for the remaining months but Microsoft distributor will bill you for it.

We are reaching out to our clients and we will work with them to optimise their cost base – but overall, I am personally not impressed with NCE. This is NOT a customer-centric model and even though I have read a number of blogs from various Microsoft partners, I find nothing to get convinced about it. Cloud computing wasn’t imagined this way!

This is an open invitation to anyone from Microsoft to convince me that NCE is good for customers and MSP.

More soon!