MICROSOFT NCE: WHAT YOU NEED TO KNOW
Q. WHAT IS NCE?
A. The New Commerce Experience (NCE) is the latest pricing model for Microsoft 365, Dynamics 365, Windows 365, and Power Platform subscriptions. NCE was designed to reduce complexity in billing processes and provide cost savings for longer term subscriptions.
Q. WHAT DOES IT MEAN FOR YOU?
A. NCE will change how you purchase Microsoft services such as Microsoft 365. Through NCE you will start a new type of annual subscription, and these prices will differ from previous subscriptions.
You can also have mid-term upgrades. Available upgrade paths are now defined by Microsoft.
It also brings a pricing premium which impacts clients who don’t want to make a minimum commitment of 12 months.
MONTHLY OR ANNUAL SUBSCRIPTIONS
Under the current purchasing program, clients are free to increase and decrease their licences on a monthly basis without penalty.
Once in the New Commerce Experience (NCE), clients can choose to retain the monthly flexibility but there will be a 20% premium charged against those licences.
If you choose to take an Annual Subscription commitment, there is no 20% premium charged and you can continue to pay on a monthly basis.
|Term Commitment: 1 full month||
|Priced at a 20% premium above the Annual Subscription option||
|Offers the most flexibility||
|No price lock||
|Can be upgraded midterm||
|Enforced cancellation policy. No cancellation or seat reduction outside of the initial 72 hours||
|Subscription seat increases can be made at any time||
|Term Commitment: 12 months||
|Priced in line with the current legacy pricing||
|Price locked for the entire term||
Annual subscriptions offer the best way to avoid mid-term price increases from Microsoft and provide a predictable cost for licensing across the year.
Annual Subscriptions cannot be cancelled mid-term for any reason. The quantity of licences cannot be reduced and there are no refunds for unused licences.
Annual Subscription user volumes may be increased at any time by the client but not decreased. Any changes made have a 72 hour cancellation window before being locked in for the rest of the term.
MONTHLY SUBSCRIPTION PRODUCTS
All products are available on an annual commitment, but not all products are available on the monthly commitment option. The following are available monthly
- Microsoft 365 Apps for Business
- Microsoft 365 Apps for Enterprise
- Microsoft 365 Business Basic
- Microsoft 365 Business Premium
- Microsoft 365 Business Standard
- Microsoft 365 E3
- Microsoft 365 E3 – Unattended License
- Microsoft 365 E5
- Microsoft 365 E5 without Audio Conferencing
- Microsoft 365 F1
- Microsoft 365 F3
- Office 365 E1
- Office 365 E3
- Office 365 E5
- Office 365 E5 without Audio Conferencing
- Office 365 F3
- Power BI Pro
- Visio Plan 1
- Visio Plan 2
- Power BI Premium Per User
- Power BI Premium Per User Add-On
- Windows 10/11 Enterprise E3
- Select Dynamics 365 offers
- Windows 365 Business
- Windows 365 Enterprise
This list is accurate as of January 2022
In addition to the move towards Annual commitments, Microsoft are also increasing the charges for certain Microsoft 365 Subscriptions.
Q.WHICH SUBSCRIPTIONS ARE AFFECTED BY THE MARCH 1st PRICE CHANGE
- Microsoft 365 Business Basic £3.80 +20% to £4.50
- Microsoft 365 Business Premium £15.10 +10% to £16.60
- Microsoft 365 E3 £28.10 +13% to £31.65
- Office 365 E1 £6.00 +25% to £7.50
- Office 365 E3 £17.60 +15% to £20.22
- Office 365 E5 £30.80 +9% to £33.40
If your Microsoft licence is bundled into your per seat price this will go up 15% as well.
Q.WHEN DOES ALL THIS TAKE PLACE?
1ST MARCH 2022: Price increase on March 1st for the above Subscriptions
10TH MARCH 2022: Any new subscriptions will be through NCE
1ST JULY 2022: NCE enforcement for existing subscriptions
FREQUENTLY ASKED QUESTIONS
Why are there changes to cancellation, refunds, and pricing when Cloud Solution Provider (CSP) is fine as it is?
Microsoft are introducing a set of new offers, policies, and functionalities that bring a consistent pricing and commitment approach across all of the different ways a client can purchase licensing today.
Why do monthly subscriptions cost more than annual or three-year term subscriptions?
Monthly offers are priced consistently across all new commerce purchase motions and are aligned to the market.
If I increase seat quantities during an annual subscription does it extend for a new 12 month period?
No. Any increase in seats on an existing 12 month subscription will simply co-terminate with the original subscription end date.
Why do I have to pay for a full term if I have financial difficulties and need to cancel before the end of the term?
In the new commerce for CSP, the expectation will be that a client chooses the better pricing on annual term offers, knowing that they’re committing to the full term of payments, whether the subscription is paid up front or in monthly instalments.
Three days isn’t enough of a cancellation period.
The 72-hour cancellation window is in line with policies used in other Microsoft new commerce purchase motions and how our competition operates. Clients who aren’t sure about committing to an annual term should be encouraged to purchase the monthly term option so that they can cancel at the end of any given month with no further payment obligation.
Will I still get billed for my subscription over the annual term even if I stop using the subscription?
Clients who choose the annual term option are accepting that;
(a) Cancellation of the subscription won’t be allowed after the first 72 hours of the term.
(b) The client is committing to payment in full in any circumstance.
This restriction is in line with the policies of competitors and in other industries in which more favourable pricing is provided in exchange for committing to the full term of payment, regardless of whether the client is using the product or service.
If a client is uncertain about or unable to commit to using a subscription for the entire term or maintaining at least the number of seats originally purchased, they should strongly consider buying the monthly term option, so that they can cancel or reduce seat counts at the end of any month’s term.