Microsoft NCE – What you need to know about Microsoft Price Increases
What is Microsoft’s New Commerce Experience (NCE)?
Microsoft recently announced a change to their licensing structure (called the New Commerce Experience or NCE) which includes an increase to the license fee. The New Commerce Experience introduces seat-based cloud offerings for Microsoft 365, Dynamics 365, Windows 365 and Power Platform. Its primary aim is to simplify the way Microsoft’s products, models and subscriptions work and provide cost savings for long-term commitments.
What does this mean for you?
As a result of this shift in the licensing structure, all Microsoft licenses provided by Access Managed Services are now subject to this Microsoft-mandated price increase.
With NCE, Microsoft now offers annual (committed) subscriptions as default and an optional monthly (non-committed) subscription at a premium. Below we outline further the difference in these subscription models.
Types of subscription models
Annual subscription, (12-month minimum term)
The annual subscription allows you to increase the number of licenses that you take but does not allow you to reduce them until the 12-month commitment is over.
- Customers can subscribe to more than one of these depending on their internal structure.
- Billing term options are annual upfront payments or monthly billing payments.
- Microsoft has indicated up to 20% cost savings by moving to an annual subscription.
Monthly rolling subscription
The monthly subscription gives you more flexibility around reducing the number of licenses that you take but it comes at a premium when compared to the 12-month subscription.
- These licenses offer the most flexibility, allowing customers to change the number of licenses month on month to flex to their needs.
- However, it's essential to note that these licenses carry up to 20% premium compared to the annual license.
- Billing term option is monthly payment only.
Changing terms
Commitment terms: It is possible to change commitment terms during an upgrade. For NCE, upgrading means transitioning from one paid subscription to another, but not downgrading from a higher-paid commitment term to a lower-paid commitment term.
Customers have the flexibility to shift from annual commitments paid monthly to annually paid commitments, as these are considered upgrades. However, downgrading commitment terms, such as transitioning from annual to monthly, is not permitted.
Billing terms: It is not possible to change billing terms mid-commitment. Changes to billing terms can only be made when upgrading; otherwise, cancellation is required, and a new order must be placed. During an upgrade, it is possible to switch from monthly to annual billing terms, but transitioning from annual to monthly is considered a downgrade and is not allowed.
How much are prices increasing by?
The specific price increases will vary per license and subscription type. Please get in touch with our Account Manager for more information.
Microsoft's price adjustments are a response to the global macroeconomic environment, impacting currencies differently and influencing exchange rates against the US dollar. The changes were implemented on 1st April 2023, with the goal of achieving greater price harmonization across the globe.
Next steps
Access Legal is committed to helping our customers navigate this change, and we will continue to keep you informed about any updates related to NCE.
Should you have any inquiries regarding Microsoft NCE and its implications for you, feel free to reach out to our team or get in touch with your Account Manager.
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