Upcoming Changes to Microsoft Open License Program

Microsoft created an Open License program over 20 years ago. The program targets small and mid-sized customers to help them purchase multiple uninterrupted software licenses at a volume price. However, Microsoft is making changes to simplify licensing to allow small and medium organizations to enjoy greater flexibility and predictable software licenses costs. 

Starting January 1, 2022, it will no longer be possible for commercial customers to renew or purchase new software licenses through the Microsoft License Program. Customers will have to go through partners on the Cloud Solution Provider program for any new license-only purchases. 

The company expects to make further announcements on its plan to have other agreement plans in the coming months. It also makes it clear that the changes do not in any way affect the Open Value Subscription programs. Organizations with these programs will continue to enjoy full rights and access to the perpetual software licenses they buy through the Open License program. 

We know that these changes will impact several industries, but we also want to know how it affects MSPs and their clients. Therefore, we reached out to various industry leaders to find out what they think about the impact of these changes. 

Impact of the Changes on MSPs

“Microsoft is canceling the Open Business license program,” says Troy Drever, President at Pure IT. What it boils down to is Microsoft is moving away from perpetual software without maintenance, support, and upgrade rights. 

However, they are still offering Open Value, which spreads licenses and Software Assurance costs over three years. They are also offering most licenses via the Cloud Solution Provider program. Drever says that his company has been working on transitioning most of their client’s licensing needs from Microsoft to the CSP program. As such, this move shouldn’t be much of a problem to the company or their clients. 

Ilan Sredni, CEO and President at Palindrome Consulting, says that this change will impact MSP procedures but not their clients. According to him, this is the most important thing.  

Ian Brady, Managing Director at Steadfast Solutions, agrees that the change will impact nearly all MSP and clients, but the impact will be very small. “Since the Open Licenses has been around for 20 years, they got lost in the system in terms of management. It was an email with a license key that generally got used once and lost. All the renewals got lost along the way,” he says. 

A New Way of Doing Business

Joe Cannata with Techsperts in New Jersey is happy with the changes. He says that his MSP generally didn’t use Open License, mainly because of its complexity. Simplification of Microsoft’s licensing programs is always welcome, as they tend to be overcomplicated. Having the ability to sell and renew their clients’ licensing through the existing CSP portal would make things much easier for MSPs and their clients.  

His thoughts are supported by Ravi Jain, Founder of Technijian. Jain says that the new arrangement makes sense as Microsoft is getting away from on-premise licensing and looking towards hybrid licenses. CSPs like his will, therefore, be able to sell under this program as well. 

However, Kyle Kalleitner from happier IT is of a contrary opinion. He believes that the changes will not affect MSPs but will affect their clients. 

Impact of the Changes on MSP Clients 

When asked how the changes will affect MSP clients, Hodge says she doesn’t foresee any problems. Since over 90% of their clients are currently on the cloud, the change is a welcome move. However, for their clients not on the cloud or using hybrid solutions, OnPar Technologies is ready to discuss with them what to do with their licensing. The move aims at preventing any potential disruptions to licensing, and making the move as smooth as possible for these clients. 

While this will be an adjustment for those not in the cloud or who are not currently working with a Microsoft Partner, this move makes sense from a security and reliability standpoint. The increased security benefits will be worth the transition phase. They will prevent end-users from keeping the same outdated OS for 10 years, which is more susceptible to breaches. 

Kalleitner says that they expect many of their clients not to be happy about this decision. Purchasing and not “owning” the license is how many brands and subscription-based services operate. However, that doesn’t mean clients will adjust happily. 

Jain feels that the move could impact users looking for long-term stability in the software as they base their products on top of it. For the majority of clients that use the software, it should make it more cost-effective. This means that it will turn capital expenditure into operational expenditure. 

What Options Do Clients Have?

Emily Hodge, the Sales and Marketing Assistant at OnPar Technologies, says that businesses have options as far as purchasing Microsoft Licenses is concerned. She says that:

  1. The Microsoft Open Value program is still available and an excellent option for those who still want to purchase Software Assurance. For any business that buys Software Assurance via the Open License program, this is a great alternative.
  2. For businesses purchasing perpetual software licenses, Hodge says that they can continue doing so from a Microsoft Cloud Solution Provider.

Brady and Hodge feel that the best option is for customers to reach out to their Microsoft Partner to see what they need to do to make this licensing transition effortless for their business and needs.  

According to Kalleitner, several options exist for clients. These include the Open value and other licensing programs that MSPs can recommend. “It isn’t the end of the world, but an abrupt change that deals with more expenses annually is never met with the happiest response from businesses, especially in today’s economic climate,” he adds. 

Clients at Technijian also have several options. For example, the company has an SPLA program that allows it to charge based on usage per month. There are also the options of CSP for the month-to-month hybrid licenses and fully cloud licenses.

Final Thoughts 

The changes to Microsoft Open License Programs seem to provoke mixed reactions among MSPs and Cloud Service Providers. However, what most people seem to agree is that the changes will enhance the commerce experience. 

If all this sounds too complicated for you right now, you may need an expert who understands to walk you through. You’ll be in a better position to know what help to extend to your clients. Reach out to us at Ulistic, and we will be your support partner. 

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Christophe Rude

Christophe Rude

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