Comparing EA vs CSP

In this blog, Principal License Consultant, Karl O’Doherty, discusses the Microsoft Enterprise Agreement vs Cloud Solution Provider Program. Originally designed for on-premise software, the Microsoft Enterprise Agreement has become the primary licensing vehicle for many organisations. Due to the emergence of Cloud computing, the way in which organisations consume Microsoft technology has evolved. Therefore, it is important that IT and procurement managers validate the risks and benefits of modernising the way in which they license Microsoft technology.

As Cloud computing becomes the new normal, many organisations face the choice of either:

  • Adding new products to their existing Microsoft Enterprise Agreement
  • Migrating all or some of their Microsoft online services to the Microsoft Cloud Solution Provider (CSP) Program

The Microsoft Cloud Solution Provider (CSP) Program is a modern licensing solution with enhanced flexibility that enables organisations to take advantage of the rapid pace of Cloud computing innovation. It also enables organisations to work with Microsoft partners with deep technical and licensing expertise like Version 1, to integrate license fulfilment with end-to-end lifecycle managed services; from solution implementation to support and billing.

Top Five Key Considerations When Comparing and Evaluating EA vs CSP

As Microsoft licensing is complex, organisations need to carefully evaluate available options and the impact they may have from an operational and financial prospective. Below are 5 key considerations when evaluating EA vs CSP to help you better prepare:


1. Commitment

  • Does your organisation want to avoid getting locked into a multi-year licensing contract?
  • Would your organisation benefit from not having the overhead associated with an upfront commitment for Microsoft online services?
  • By having the ability to cancel licenses on demand, would you gain a competitive advantage?
  • Do you have fewer than 500 users and want to avoid investing in licences to meet the Enterprise Agreement minimum thresholds?

Organisations that recognise the benefits of the above flexibility should evaluate the use of CSP as an alternative way to license Microsoft technology.


2. Cost Control

  • Do you want the power of choice when it comes to what and when you license Microsoft online services?
  • Would a monthly billing cycle for online services have a positive impact on cashflow?
  • Or is there an appetite to mix and match monthly billing and annual billing models to optimise pricing and protect cashflow?
  • By combining licensing and managed services, can you negotiate innovative pricing models with your CSP?

Through the adoption of CSP, your organisation could introduce new procurement models for Microsoft online services that enable greater cost control.


3. Pay as You Grow and Pay As You Slow

When forecasting Cloud requirements does your organisation fully understand the licensing and financial impact associated with:

  • Expansion and contraction in user counts?
  • Usage of license entitlement buffers designed to meet perceived changes in demand?
  • Changes in end-user licensing profiles?
  • Contractual limitations regarding the ability to true down?
  • Reacting effectively to IaaS & PaaS demands?

Failure to understand the above can result in shelfware that results in financial waste as well as unforeseen expenditure.

Where there are continually changing demands for Microsoft Cloud service requirements, CSP can prevent licensing waste and redundancy.


4. Enhanced Support

  • Are you concerned that the limited support included with the Enterprise Agreement program will meet your needs?
  • Have you experienced challenges associated with not having a dedicated support team that knows your business and Microsoft environment?
  • Are you concerned about the cost implications of having a direct paid support contract with Microsoft?

Working with a CSP partner enables access to enhanced support options combined with access to Microsoft Premier Support.


5. More Than Licensing Resale

  • Are you working with a Microsoft licensing reseller that treats the sale of Microsoft online services as transactional?
  • Does your Microsoft partner proactively help you control Microsoft Cloud consumption costs or simply collect scheduled payments?
  • Are you realising the business value from your investment in Microsoft Cloud with the support of your partner?
  • It is important when choosing a CSP partner that you work with a Cloud solution provider that has a combination of software asset management and technical expertise to ensure you:
  • Optimise and control Microsoft Cloud related licensing costs
  • Realise the business value from your investment in Microsoft technology

Key Takeaways

Although the considerations outlined in this blog indicate that CSP is a viable alternative to the Enterprise Agreement license program, it is important that we provide balanced commentary by saying CSP is not a one size fits all program.

There are other considerations that can impact on an organisation’s suitability for CSP, such as:

  • The size of your organisation and the economies of scale that can be achieved using standard pricing models
  • Whether you can negotiate volume discounts directly with Microsoft
  • If you have the ability to attain custom licensing and contractual terms
  • If there are any product availability or technical constraints associated with CSP
  • If your business requires a high degree of predictability and multiple year fixed pricing for all Microsoft products

Starting your evaluation of CSP early is essential when validating Enterprise Agreement alternatives. We recommend that you start this process or engage with external support to complete this evaluation 6 months before your Enterprise Agreement Renewal.


About Version 1

Version 1 is experienced in helping organisations assess their suitability and the ROI associated with migrating from Microsoft Enterprise Agreements to CSP from a licensing and technology perspective. Learn more about our Microsoft Optimisation Solutions.