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Microsoft NCE Changes

Q&A on Terms of NCE: 

1: What seat-based subscriptions does NCE affect? 

 Microsoft 365, Dynamics 365, Power Platform, and Windows 365 offers, plus associated add-ons. 

 2: Will billing dates change? 

 No. The billing cycle will remain at the beginning-of-month to last day-of-month cycle. 

 3: Will the available subscription terms change? 

Yes. As well as continuing with the 12-month commit term, Microsoft will be introducing 1-month and 3-year commitment terms for subscriptions. 

  • 1-month commit term (incurs 20% price uplift vs legacy) 
  • 1-year (12-months) commit term (same as legacy pricing) 
  • 3-year (36 months) commit term (currently Dynamics 365 subscriptions only – others expected March 2022) 

 4: Can I purchase the annual term and still pay monthly? 

 Yes. You can choose to commit to a 1-year or 3-year term and pay for subscriptions monthly. However, you will be unable to decrease seat count or subscription type each month during the commitment period. You can only do this at renewal. 

 5: Can I increase or decrease my seat count mid-term? 

 You CAN INCREASE your subscriptions seat count mid-term with immediate effect and the additional seats will be pro-rated to the original commit term end date. However, you CANNOT DECREASE your subscriptions seat count mid-term. You will have to wait until subscription commit term renewal to reduce the seat count. 

6: Can I have one NCE SKU with multiple terms? (Hybrid) 

Yes, you can enact a plan with two terms in the same offer. In a small-midsize business space, temporary employees are common over the course of the year.  For these customers, mixing annual and monthly agreements for permanent and temporary users may be the most cost effective and flexible solution. 

For example, as a partner, you can elect to mix monthly, annual, or multi-year term expiration. This alternative route gives you maximum flexibility to choose the right term for your company.  

Comparing Strategies 

  1. Company A has 500 employees and purchases the Microsoft NCE Annual plan.  They order 500 licenses for the full year. Throughout the year, 80 employees leave the company, leaving Company A overpaying for these 80 unused licenses. 
  1. Company B has 500 employees also. However, they decide on using the NCE Annual plan for 400 users while using a NCE Monthly plan for 100 users.  Company B will pay 20% extra on the monthly price for these 100 users, but will save on the annual subscription costs of the departed employees. 

7: Are subscription seat adds pro-rated when adding mid-term? 

 Yes, you can increase your subscription(s) seat count mid-term and the additional seats will be pro-rated to the original commit term end date. 

 8: When will I have to transition to the Microsoft CSP New Commerce Experience model by? 

 Originally planned for March 10th 2022, Microsoft announced on November 12th 2021 that they will extend the period during which subscriptions can be renewed on the legacy CSP platform to June 30th 2022. 

9: Can I Change an Annual Term Commitment Offer to a Monthly Commitment Offer? 

The option to switch plans from annual to monthly is only available within 72 hours after placing an order for an annual subscription.  This would require you to cancel the annual commitment offer within 72 hours of placing the order to receive a pro-rated refund. You can then place the order for the Monthly commitment offer.  You cannot switch from an annual commitment offer to a monthly commitment offer outside of the initial 72 hours. 

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