Microsoft ends Open License program, new opportunities for CSP partners

Microsoft CSP , Azure

Oct. 8, 2020

Martijn Couprie

Last Wednesday September 30, Microsoft announced it will end its Open License program. This program enabled small to midsized customers with between 5 and 500 employees, to purchase software licenses for Microsoft technology such as Office and Windows. By ending the Open License program, soon making perpetual licenses available via the CSP program and recommending Open License customers to start purchasing via the CSP program, Microsoft is creating new opportunities for CSP partners.

 

The Open License program

The Open License program was started over 20 years ago by Microsoft as part of the ‘Open’ program family. Through It customers can buy software licenses on a pay as you go model, similar to CSP. Unlike CSP, Open License customers need to purchase a minimum of five licenses and sign a 2 year agreement. 

The Open License program also does not offer the kind of rebates per transaction for partners that the CSP program does, only price discounts on high volume bulk purchases of similar licenses. The Open License program is mostly used by customers to purchase ‘perpetual software licenses’, where the customers buys once and licenses never expire, for instance customers could buy Office 2010 licenses, download the software and install the software on their desktops. These licenses however do not include upgrades, so customers looking to upgrade to Office 2019 had to purchase completely new licenses. 

With the introduction of the new commerce experience, Microsoft’s aim was to simplify licensing and flexibility in selling to customers. Because of this Microsoft is removing purchasing options that no longer meet its requirements. That is why Microsoft has now decided to end the Open License program, and recommends customers to start purchasing licenses or subscriptions via CSP partners. 

 

Perpetual software licenses added to CSP

To increase the likelihood of Open License customers moving to purchasing via CSP partners, Microsoft announced in July at Inspire that is will also add perpetual licenses available for on-premises deployment to the CSP program. That way it is much easier for partners to move Open License Customers to CSP. 

 

Timeline

On January 01, 2021 Microsoft will begin adding perpetual software licenses to the CSP program. Microsoft’s wording on this date is a little vague, it being called a ‘target date’, so some delays can be expected here. Then after December 31, 2021, commercial customers will no longer be able to purchase or renew licenses. This gives CSP partners at least a year to support commercial customers in moving from Open License to CSP.

 

Opportunities for CSP partners

With the Open License program ending, and the likelihood of the Open Value and Open Value Subscriptions also to be phased out, CSP partners can support moving commercial customers to the CSP program. This can be existing customers purchasing with you as their IT partner, but can also include new customers, who’s current IT partner does not support the CSP program. 

Through the CSP program partners can offer their small and midsize customers the time and cost benefit of a simplified approach to license asset management. It also adds greater flexibility in purchase opportunities. And CSP partners can enjoy rebates on purchases not available via the Open License program.

The addition of perpetual software licenses to the CSP program available for on-premises deployment also adds another range of licenses to sell to customers, and opens up opportunities to reach a new target audience previously not available, with support, training, managed services and other paid value-adds on top of the licenses or subscriptions. 

Finally, even though perpetual software licenses never expire, the software does go End Of Support and End Of Life. For instance, Windows 7 and Office 10 went out of support this year, offering CSP partners opportunities to upgrade customers to modern solutions such as Windows 10, Windows Virtual Desktop and Microsoft 365

Learn more, download our free guidebook ‘Open License to Cloud Solution Provider (CSP) program’, or get in touch if you have any related questions. We’d be happy to help out. 

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