Upon signing the agreement, Customer must define and communicate to Microsoft the number of desktop computers or qualified users and the desired Microsoft Enterprise or Enterprise Online Services products. This information represents the initial purchase. Each anniversary must be the subject of a true up order for additional workstations or skilled users, on the basis of which the total cost of the previous year is calculated. Under a traditional on-premises Microsoft Enterprise agreement, the customer is allowed to license enterprise products individually or as a standard platform. However, at least one enterprise product must be standardized across the enterprise. In a three-year contract, the number of desktops and qualified users can be adjusted on each contract anniversary. This allows for more flexibility to meet changing requirements. The rights of use are limited and end at the expiry of the contract. Ea renewal: When it`s time to renew an EA, you can review your entire investment and make adjustments to ensure the new agreement meets current and future requirements. Microsoft is committed to moving its enterprise customer base from traditional on-premises software to its subscription-based cloud services.
Revenue from commercial cloud offerings is growing significantly, while revenue from traditional software is declining and the mix is weighing on Microsoft`s ability to support a multi-faceted business. Microsoft`s success will be measured by how well it fulfills this mission, and customers will be under greater pressure to move to the cloud or pay the price through greater complexity of contracts and pricing for on-premises solutions. Most customers have made the leap to 365 and are experimenting with at least azure. The good news is that the agreement window is always open for all new cloud spending with Microsoft. In the past, Microsoft customers have had a negotiating game while waiting for the end of their EA mandate to extend it, especially if that period coincided with the end of Microsoft`s quarter or fiscal year. This is no longer the case, especially for purchases and extensions of the fiscal year (June), calendar year and quarter-end, when volume stifles the system. Microsoft is making great efforts to get customers to renew much earlier in the quarter, including better prices and discounts or the ability to adjust contract dates. Customers need to know how to use the contract schedule to get cheaper concessions and more flexibility. While the vendor`s cloud-based offerings may be the future of its enterprise business, most Microsoft customers are still operationally and contractually bound to on-premises deployments.
With the registration contract structure, you can easily add new products and services as needed: Microsoft`s best-offer discounts are rarely best-in-class. The difference between the discount a customer receives and what another customer receives with similar requirements can be significant. When a below-average discount becomes the basis for future EE renewals, overspending increase exponentially. Customers should benchmark prices across all facets of their Microsoft fleet to ensure they are getting a fair deal and ensure they are paying a price that is on or better than the market. There are different ways to license and/or subscribe to Microsoft products. The provider or account representative of a particular company may not be familiar with all the options available. However, they are well trained (and motivated by incentives) to get customers on the path to higher licensing costs. Be sure to ask Microsoft licensing specialists how you can better structure licenses to reduce expenses, and consider getting unbiased expertise to help the procurement team review recommendations.