Rachel Coyne on 27 Apr 2022

Microsoft’s New Commerce Experience: What it means for CSP customers

What is Microsoft’s New Commerce Experience (NCE)?

Microsoft is simplifying the buying experience for business customers and earlier this year began rolling out its New Commerce Experience (NCE). Essentially, the NCE is a new pricing model. Microsoft is moving away from disparate purchasing programs and product-specific offers by streamlining and updating pricing to help business customers reduce complexity and achieve better purchasing flexibility. With the NCE, all purchasing and contracts will be combined into a single “Microsoft Customer Agreement”.

Microsoft is rolling out the NCE in a phased approach and the first phase impacts SaaS products purchased by the seat/user. All commercial customers currently on a cloud subscription plan will be impacted.

Listed below are the seat-based subscriptions impacted by the changes:

Microsoft launched the New Commerce Experience for Microsoft Azure in 2019 – and now is expanding the NCE to include:

  • Office 365 / Microsoft 365 *
  • Dynamics 365
  • Windows 365
  • Power Platform

Currently, only SaaS licences (commercial seat-based offers) will be impacted by the new terms. However, that may change in the future.

Purchase Implications

As Microsoft rolls out the NCE, it’s important to note the three different Microsoft-defined “buying motions”:

Breadth: Purchasing software through a Cloud Solution Provider (CSP) – the primary way most business customers will purchase Microsoft software solutions.

Enterprise: Purchasing software via an Enterprise Agreement with Microsoft.

Self-Service: Purchase software directly via Microsoft on the internet via credit card.

The New Commerce Experience brings the CSP program into alignment with other programs, such as the Enterprise Agreement. It includes new licensing and monthly subscription options for commercial licences so that all customers have a consistent purchasing experience and are subject to the same terms and conditions for cloud purchases regardless of the Microsoft sales motion.

New Commerce Experience impact on CSP customers

If you currently purchase Microsoft cloud products through a Microsoft Cloud Solution Provider (such as Satalyst), the way you purchase will be impacted. The change will impact customers differently:

  • Pricing is based on per-user/seat subscription licences
  • Subscriptions are paid in advance
  • Licences can be purchased on a monthly subscription term, 12-month subscription term, or 36-month subscription term
  • Users/seats can be added during the term of a subscription; however, removing users/seats can only be done at the end of the subscription term
  • If you purchase Microsoft products on a monthly subscription, you can decrease users/seats monthly.
  • Microsoft imposes a price premium of a 20% increase on monthly subscriptions.
  • The benefit of committing to a 12-month or 36-month subscription term is to lock in the price and not be subjected to price increases during the term.
  • Microsoft allows a 72 hour cancellation period allowing, e.g., cancel a 12-month commitment to receive a pro-rated refund
  • Microsoft will allow a hybrid subscription model, i.e., you can lock in your price for the number of users or seats you know you will need for the next 12 or 36 months and also have a number of flexible seats that you purchase on a monthly subscription.
  • Billing options include monthly, annually, or 3-year upfront
  • The ability to renew existing subscriptions on the legacy CSP platform will continue through 30 June 2022

Important upcoming dates

1 July 2022: Renewal of legacy CSP subscriptions into NCE subscriptions only.

1 October 2022: All customers will have to purchase through NCE.

Satalyst is here to help

The New Commerce Experience promises greater standardisation of offers and terms, giving customers greater choice and flexibility in how they buy. The Satalyst Cloud Managed Services team is here to help. As a Microsoft Tier-one Partner Cloud Solution Provider, we can help you understand your options and take advantage of the best cloud licencing structure to suit your organisation’s needs and budget.

Contact Us


* New pricing for Microsoft 365

Although not directly related to the New Commerce Experience, on March 1, 2022, Microsoft 365 increased in price (depending on the SKU). This is the first significant price increase since Office 365 was released more than a decade ago and reflects the value of innovation that’s been added over the years. Microsoft has updated its list pricing for the following commercial products: Microsoft 365 Business Basic (from $5 to $6 per user), Microsoft 365 Business Premium (from $20 to $22), Office 365 E1 (from $8 to $10), Office 365 E3 (from $20 to $23), Office 365 E5 (from $35 to $38), and Microsoft 365 E3 (from $32 to $36). These increases apply globally with local market adjustments for certain regions.

About Satalyst
As part of Canon Business Services ANZ and a leading Gold Microsoft Partner specialising in cloud, security, and data, Satalyst has over 10 years of expertise in delivering innovative cloud solutions to Australian businesses. We’re committed to a customer-centric approach to transforming business processes and productivity, by offering tailored support, change management and training to clients at all stages of their technology project rollouts.

Our team will adapt to your preferred style by either working collaboratively alongside you or working for you and taking it off your hands. Our experts have cutting-edge skills and knowledge in cloud and security but will also readily engage with your business to understand your objectives, culture, and operating style.

New Commerce Experience FAQs

1. What seat-based subscriptions does NCE affect?

Microsoft 365, Dynamics 365, Power Platform, and Windows 365 offers, plus associated add-ons.

2. Will billing dates change?

Yes. The billing cycle will be updated to reflect a beginning-of-month to last day-of-month cycle.

3. Will the available subscription terms change?

Yes. As well as continuing with the 12-month commitment term, Microsoft has introduced 1-month and 3-year commitment terms for subscriptions.

1-month commitment term (incurs 20% price uplift vs legacy)
1-year (12-months) commitment term
3-year (36 months) commitment term

4. Can I purchase the annual term and still pay monthly?

Yes. You can choose to commit to a 1-year or 3-year term and pay for subscriptions monthly. However, you will be unable to decrease seat count or subscription type each month during the commitment period. You can only do this at renewal.

5. Can I increase or decrease my seat count mid-term?

You can increase your subscription’s seat count mid-term with immediate effect and the additional seats will be pro-rated to the original commit term end date.

You cannot decrease your subscription’s seat count mid-term. You will have to wait until the subscription term renewal to reduce the seat count.

6. Can I upgrade or downgrade a subscription mid-term?

You can upgrade your subscription(s) mid-term (partial/all) with immediate effect and the upgraded subscription will be pro-rated to the original commitment term end date.

You cannot downgrade your subscription(s) mid-term. You will need to wait until the subscription commitment term renewal to downgrade/change to a lesser subscription.

7. Are subscription seat adds pro-rated when adding mid-term?

Yes, you can increase your subscription(s) seat count mid-term and the additional seats will be pro-rated to the original commit term end date.

8. When will I have to transition to the Microsoft CSP New Commerce Experience model?

Subscriptions can be renewed on the legacy CSP platform until June 30th 2022.

1 July 2022: Renewal of legacy CSP subscriptions into NCE subscriptions only.

1 October 2022: All customers will have to purchase through NCE.


Contact Us