Tag Archives: Enterprise Agreement

More Flexibility in Purchasing Windows Azure through an EA

Announcement from Microsoft regarding more flexibility in purchasing Windows Azure through the EA: “On Nov 1, Microsoft will offer Enterprise Agreement (EA) customers access to discounted Windows Azure prices, regardless of upfront commitment, without overuse penalties and with the flexibility of annual payments.” Read the full press release here: http://bit.ly/1e5qNRy

A Bluffers’ Guide to the Server and Cloud Enrolment

If you’re a Microsoft licensing expert you probably feel you should have at least a fundamental understanding of the new Server and Cloud Enrolment from Microsoft, due to be released in the last quarter of 2013. If you haven’t yet done your swotting up, take the easy option and read on for the “must know” facts about this enrolment in the first part of our series on this new licensing option.

The Enterprise Agreement
The Server and Cloud Enrolment (SCE) is signed under the Enterprise Agreement. Does this mean that it’s only targeted at Microsoft’s largest customers? No, absolutely not, and although customers do have to meet some minimum commitments, it’s well within the grasp of many customers. Customers don’t have to have an existing Enterprise Agreement and if they like what SCE offers, they can sign a new EA with just this enrolment. Given that the enrolment is signed under the EA, certain EA attributes filter through – namely that it’s a three-year term, and Software Assurance is included.

The Products
So, what products are we talking about? A “traditional” EA is all about Windows, Office and the CAL Suites; the SCE is all about Windows Server, System Center, and SQL Server. Now, there ARE other products – for instance, Visual Studio and Windows Azure – that you can buy under this enrolment but we’re going to save those details for later in the series. If you’ve heard about the Enrolment for Application Platform (EAP) or Enrolment for Core Infrastructure (ECI) in the past, then the SCE replaces these. EAP was mainly about SQL, and ECI about Windows Server and System Center, so this makes sense.

Windows Server and System Center
Windows Server and System Center are sold together under the SCE as the Core Infrastructure Server Suites, or (thankfully) the CIS Suites. These Suites come in Standard or Datacenter flavours to reflect the editions of Windows Server and System Center. As you would expect, the CIS Standard Suite includes Windows Server Standard and System Center Standard, and the CIS Datacenter Suite includes the Datacenter editions of both products. The licensing of the CIS Suites mirrors the licensing of the included products, being Processor-based with one licence covering up to two processors on the same machine.

Customers need to commit enterprise-wide to the CIS Suites which means that they have to buy one or other of the CIS Suites for every Windows-based server in their organisation and there’s a minimum purchase requirement of 25 licences. In a later post we’ll look at what happens if they already have Windows Server or System Center licences with SA for their installed base.

SQL Server
Alternatively, a customer can use SCE to purchase their SQL Server licences, and it’s important to note that these purchases are completely independent of the CIS purchases. A customer could have one enrolment with both products included, or an enrolment with just one; there are no additional discounts available for committing to more than one product.

Buying SQL Server licences is very similar to acquiring the CIS Suites. There’s a commitment for a customer to cover their entire SQL Server estate with the latest versions of SQL Server with Software Assurance, and there’s a minimum size of this estate: if they license via the Server/CAL model it’s 5 Server licences and 250 CALs, if they’ve opted for the Core licensing model, there’s a requirement for 50 Core licences.

And now…
Ready to check that you’ve thoroughly digested these key facts? Watch out for our Bluffers’ Guide SCE test coming shortly. And if you score a passing grade in that then you’re ready for Part 2…

SCE v EAP Price Changes – the Maths!

Those who know me may recall that I started life as a maths teacher, so a chance to dabble in a bit of algebra is always a treat. And for those of you who hate algebra and could never see a use for it – well, here it is – a way of working out the price changes in SCE (the new EA Server and Cloud Enrolment) and EAP (the old Enterprise Application Platform Enrolment).

We know that in the EAP, licences are split into either Standard or Enterprise flavours and customers get either 15% or 40% discount off the price of a new licence and no discount off the compulsory three year’s SA. So, for a SQL Standard licence costing “S” the price paid over 3 years is 0.85 x S + 3 x SA. Since SA is 25% of the licence price, it’s 0.85 x S + 3 x 0.25 x S = 1.6 x S. In other words, if you know the list price of a SQL Standard licence, the customer actually pays 1.6 times that through the lifetime of the EAP.

Good. Let’s do the same with a SQL Enterprise licence. Using a similar approach with “E” being an Enterprise licence, the price paid over 3 years is 0.6 x E + 3 x SA or 0.6 x E + 3 x 0.25 x E = 1.35 x E. So the customer pays 1.35 times the price of an Enterprise licence through the EAP.

And what about SCE? Well, there’s no differentiation between Standard and Enterprise licences (good) and there’s a 15% discount off the TOTAL L&SA price (interesting). Again taking a SQL Standard edition licence costing “S” we can work out that the customer pays 0.85 x S + 0.85 x 3 x SA or 0.85 x S + 0.85 x 3 x 0.25 x S which (finally) comes to 1.4875 x S. Luckily, since the calculations are the same for the Enterprise edition, we’re done!

And the conclusions? Well, for a SQL Standard licence, the customer pays 1.6 times the licence in an EAP and 1.4875 times the licence in SCE. Dividing 1.4875 by 1.6 gives 0.9296 which tells me that it’s a 7% decrease in price for the total L&SA price over the life of the SCE. For SQL Enterprise, it’s 1.4875 divided by 1.35 which gives 1.101 which represents a 10% increase. So, not huge changes in price for a customer.

So don’t you wish you’d paid attention in your maths lessons? 😉

More on the Office 365 Add-ons

I’ve taken all this information from the Microsoft webcast on this topic at http://bit.ly/15elDBr. If you like to learn by watching a video then proceed with all haste to this link. Otherwise read on for the key points which act as a follow on article to my introductory post on this topic.

Program Availability

  • The Add-ons will be available through the perpetual EA first, then the program will be extended to the Subscription EA as needed
  • There are no changes to the Select Plus program at this point in terms of making these Add-ons available

SKU Notes

  • A customer needs either Core CALs or Enterprise CALs as the underlying licences to purchase these Add-ons and in all cases they’ll need to specify whether they are adding to an underlying Device or User CAL. All Add-ons are USLs
  • Core CAL customers can choose to add on E1
  • Core CAL and Enterprise CAL customers can purchase an E3 or E4 Add-on with or without Office Pro Plus. There is obviously be a price difference, and customers are able to mix the Add-ons within their estate
  • Note that because the customer is maintaining their full CAL there is no need for a Bridge CAL which is required in a transition for the components that aren’t covered by the Office 365 plan

Transactional Notes

  • The Add-ons are Additional Products in the EA, and by default are co-terminous with the EA
  • There is no minimum purchase quantity for the Add-ons, and they may be added by the licence reservation process and then reconciled at the anniversary in the usual way
  • The Add-ons are valid until the end of the contract; at renewal the customer can move to a full USL (via transition) or they can continue to use Add-ons at renewal
  • Customers may mix models (transition and Add-ons) although it’s not necessarily advisable as it may be confusing to manage…!
  • The Add-on is added on for the Primary User of the existing underlying licence and is for a single user if there are multiple people using a device; at no time can you have more Add-ons than underlying licences
  • The standard Online Services terms remain in place, such as cancellations being allowed within 30 days

Pricing

  • All Add-on prices are monthly prices that take into account the customer’s existing investment. In other words, an E1 Add-on USL to Core CAL is cheaper than the full E1 USL for customers who have not invested in Core CAL
  • There are different prices for the different EA Levels, as usual
  • Customers can add pricing for the Add-ons at any time and if they want locked pricing they should use a Supplemental CPS, as usual
  • The Add-on price is the same for L&SA and SA-only EAs

Rights

  • If a customer has, for example, the Enterprise CAL Suite with Office Professional Plus and adds on the E3 Add-on then he retains the rights of the Office Professional Plus licence (perhaps continuing to downgrade to Office 2010) AND receives the rights for Office 365 Pro Plus (such as the multiple install rights)
  • However, the customer must make sure that there is always the underlying licensing in place for the base EA; so any new Qualified Devices must be covered with their own licences rather than using the multiple install rights of an Office 365 Pro Plus licence assigned to another device. The additional rights should be used (as usual) for non-qualifying devices such as mobile devices or in BYOD scenarios

An Introduction to the Office 365 Add-ons

Starting on 1st August 2013 customers will be able to add Office 365 Add-ons to their Enterprise Agreement. Hurrah! Er, actually, why might they want to do this? Well, it’s a brand new model to help customers move to the cloud – let’s take a look…

Previously, customers HAVE been able to move to the cloud in their EA by transitioning their on-premise licences to Office 365 User Subscription Licences (USLs). The simplest example was a Core CAL customer who wanted to transition to Plan E1 who, in effect, traded in his Core CAL licences for E1 USLs and Bridge CALs to cover those components not included in E1 (the Windows CAL and Endpoint Protection). This worked well for customers who were committed to the cloud and didn’t need to retain perpetual rights to on-premise licences, and indeed transitioning will remain a licensing option for customers.

However, for the customer who wants to evaluate the cloud or who does want to move to hosted services, but feels uncomfortable about losing their perpetual rights to existing licences, the new Add-ons are a good solution.

Let’s take an example of a customer who has an EA with 500 Core CAL and Office Professional Plus licences who wants to move 50 users to the cloud and thinks that Office 365 Plan E3 will best meet his needs. He simply purchases 50 E3 Add-on USLs. The structure of the existing EA remains exactly the same with these add-ons which means that he still retains the rights to the underlying licences (downgrade rights, SA benefits etc) and if he decides that E3 isn’t for him, he simply cancels the subscription at anniversary and his licensing position is intact.

I’m sure that you’ve got lots of questions on this! Check our next blog post where we’ll look at the next level of detail on this.