Whats is Azure Plan?

Azure Plan is the new commerce experience introduced by Microsoft in Partner Centre.

Why have Microsoft introduced Azure Plan?

There are 2 main reasons that Microsoft introduced Azure Plan:

  1. To reward partners who add value on top of Azure by providing managed services rather than simply reselling it. With the existing Azure offering, a CSP partner receives a discount when buying Azure regardless of whether the partner is actually servicing the customer’s Azure environment. In the new commerce experience, discounts have been replaced with “Partner Earned Credits” (PEC). CSP partners will only qualify for PEC when they have admin management access to the customer’s Azure environment.

    This means that selling Azure only, without providing any management services, will no longer generate margin. See What is partner earned credit and how do I get it? for more details on PEC.

  2. To address the complex and varied pricing model within Azure. Different countries, currencies, and licensing programs have their own extensive price lists, making it difficult for an Azure-focused MSP to track. With Azure Plan all pricing will be tied to a single global price list in USD, aligning all licensing programs and geographies.

What is the financial impact of Microsoft moving to a single price list in USD?

As there’s one single US price list for Azure Plan, the price of Azure services outside of the US may change each month due to exchange rates.

For UK customers, on the first day of each calendar month Microsoft will use that days exchange rate from US dollars to GBP. That rate will apply to all transactions and usage that month.

This new arrangement will mean Azure bills fluctuate month to month based on both variable usage and exchange rate shifts.

What are the benefits to me of moving to Azure Plan?

The key benefits are:

  • Having the ability to enable multiple Azure subscriptions in one single Azure Plan
  • Removing the need to submit a separate order per Azure subscription
  • Aligning CSP partners to a single global pricing list, enabling you to offer Azure at the published price
  • Unlocking access to ‘Azure Cost Management’, enabling you to:
    • Monitor cloud spending – by tracking your customers resource usage quickly and easily
    • Optimise cloud efficiency – by having the ability to view recommendations which can result in cost savings
  • Unlocking access to ‘Azure Lighthouse’, enabling you to:

    • Manage at scale - with engagement and life-cycle operations to manage customer resources being easier and more scalable.
    • Have greater visibility and control for customers – giving you precise control over the scopes you delegate for management and the permissions that are allowed
    • Benefit from a comprehensive and unified platform tooling: which addresses key service provider scenarios, including multiple licensing models such as EA, CSP and pay-as-you-go.

How will I continue to make margin on Azure Plan?

The existing margin model has been replaced with ‘Partner Earned Credit’ (PEC); a reward for partners delivering managed services to their customers. See Why have Microsoft introduced Azure Plan? for more info.

So long as you qualify for PEC, you’ll still receive the same discount you always have via Giacom.

What is partner earned credit and how do I get it?

Partner Earned Credit (PEC) is Microsoft’s new methodology for rewarding partners who actively manage their customer’s Azure environment and not rewarding partners who simply resell Azure. If all you do is resell Azure without any managed services, you will make 0% margin and will receive no PEC. If you help your customer deploy and manage an Azure environment, you will qualify for PEC and see it as a rebate on your CSP invoice from Microsoft. Read more information about PEC.

To receive PEC, you need to have operational control and management of the customer’s Azure resources in CSP with relevant RBAC (role based access control) access (i.e. Delegated Admin Access). Read more info about roles and permissions or to learn more about how to manage subscriptions and resources under Azure Plan.

When a new Azure Plan is created, this access is automatically assigned and must stay in place. If removed, then all discounts will no longer be applied and a 10% admin fee will be added to your Azure bill.

If transitioning from existing Azure to Azure Plan we recommend that you review your access to ensure you will receive PEC.

I currently earn indirect reseller incentives on existing Azure. Will I still receive this on Azure Plan?

To be eligible for incentives on Azure Plan you need to have Gold Cloud Platform Competency. Microsoft’s Incentive Team have told us they intend to increase the scope of the programme to include Silver Cloud Platform competency partners in the eligibility criteria for Azure Plan in FY22.

Will I be forced to move onto Azure Plan?

New subscriptions in Cloud Market will be forced onto Azure Plan from 1st July 2021. Microsoft are yet to announce a specific date for enforcement of existing subscriptions to be moved onto Azure Plan. We’ve been told that all partners will be notified 6 months in advance however we advise that you move to Azure Plan ASAP.

We also believe that, eventually, Microsoft are planning to bill all their products and services in the same way as Azure Plan.

On Azure Plan, will I lose any of the other Azure benefits that I get as a Giacom customer?

No, as a Giacom customer you’ll continue to benefit from our exclusive Azure value adds such as our Cost Reporting Template, Billing API and Azure Hub.

Will my customer have any downtime if I move over to Azure Plan?

No, your customers will not have any downtime during migration to Azure Plan.

How do I add new subscriptions on Azure Plan?

From 1st July 2021 any new subscription will be added onto Azure Plan automatically.

How do I move existing subscriptions to the Azure Plan?

If you want to transition existing subscriptions, please get in touch with our technical support team via any of the available contact methods and they’ll be happy to help.

Can I transfer Azure reserved instances from existing Azure to Azure Plan?

No, although Microsoft are currently working on this.

What key dates do I need to be aware of?

  • 1st July 2021: Existing Azure will no longer be available to purchase for net-new partners or net-new customers transacting in CSP
  • Calendar Year 2022: Microsoft will start to remove incentives and partner margin opportunity from existing Azure, to drive existing subscriptions onto Azure Plan. Microsoft will notify all affected partners 6 months in advance
  • Date TBD: Any remaining partners on the existing Azure offering will be force migrated to the new Azure Plan. Once we have a confirmed date we’ll let you know.