Organizations who have transitioned from Microsoft Premier Support to the new Unified model are now finding themselves faced with significant cost increases at their Unified Support renewal. It’s important to understand why the cost increase is hitting hard and why the increases will continue into the near future.
The first reason enterprises are being hit with steep Unified Support cost increases at renewal is that they have used all their available Microsoft discounts to keep costs down while transitioning to the new Unified model from Premier. More specifically, all possible Software Assurance (SA) credits have been applied and are no longer available. See below for more details on the credits and how they were applied to your Unified Support bill.
Why aren’t there any more discounts available? Microsoft Enterprise Sales teams knew that most Premier customers would see costs increases somewhere between 30-60% and as result, they creatively rolled all SA credits into the first year of Unified to offset the cost increase. In the past, SA credits were spread across the life of an Enterprise Agreement (EA) – typically 3 or 5 years. So you would take 1/3 or 1/5 of your SA credits each year. Unfortunately, many organizations have burned all their discounts in the transition year to Unified and have no further discounts available until their EA renews again.
The second important factor of sky rocketing Unified Support renewal costs is that renewals will continue to increase for the next 3-8 years for most Microsoft enterprise customers. The reason is simple. Unified Support is based on the amount of Cloud services you are consuming at Microsoft. And that consumption is spread across the life of your EA.
2019, 5 Year Microsoft Enterprise Agreement (EA) Renewal Tied to Unified Support
Let’s look at an enterprise with a 2019, 5-year Microsoft Enterprise Agreement (EA) renewal who has recently rolled out Office 365 to its user base.
Year 5 – 2018-19
Year 4 – 2017-18
Year 3 – 2016-17 – Office 365 rollout to entire enterprise
Year 2 – 2015-16 – Office 365 pilot program
Year 1 – 2014-15
The above enterprise will see a big uptick in the Unified Support cost renewal in 2019 due to the increased Office 365 subscription, but the lookback baseline only affected roughly half of the prior Enterprise Agreement. The second 5-year Enterprise Agreement renewal in 2024 will see yet another Unified Support uptick as the baseline now covers all 5 years of Office 365 consumption.
2024, 5 Year Microsoft Enterprise Agreement (EA) Renewal Tied to Unified Support
Let’s look at the same enterprise with their 2024, 5-year Microsoft Enterprise Agreement (EA) renewal who has recently rolled out Azure for its production IT infrastructure needs.
As a reminder, they have successful rolled out Office 365 to all its users in 2016 and will see the full weight of its Office 365 consumption in its EA and Unified Support cost increase in 2024.
Year 5 – 2023-24
Year 4 – 2022-23
Year 3 – 2021-22 – Azure rollout to enterprise production
Year 2 – 2020-21 – Azure pilot program
Year 1 – 2019-20
With the addition of Azure, the above enterprise will see another increase in their EA/Unified Support renewal in 2024 and yet another increase in 2029 as they see the full weight of their Azure consumption hit both their EA and Unified Support bills.
Conversion of Software Assurance 24×7 Problem Resolution Support Incidents to Premier (Unified) Support Services
With the exception of MPSA, Customers may convert SA 24×7 Problem Resolution Support Incidents (SA PRS Incidents, or “SAB”) to Unified Support, Premier Problem Resolution Support (PRS) hours or Dedicated Support Engineer (DSE) hours (applicable for reactive support activities only).
These services are for use consistent with their Premier Service or Unified Support plan at the time of transfer. The convers ion is based on a local rate calculation that will be provided by their Premier Account Team. Customers may be required to purchase additional Support Account Management hours before converting SA PRS incidents. SA PRS incidents that are converted to Premier are considered Premier Problem Resolution Support hours and are subject to the Premier Services Description. Once converted, incidents cannot be returned to Customer’s SA allowance.
Additional Business Provisions
SA spend may not be combined across Select or Enterprise enrollments, Select Plus registrations, Purchasing Accounts, or Open Value Agreements to qualify for additional awards. Spending within each enrollment, agreement, or Purchasing Accounts will be used to determine the award for that enrollment, agreement, or Purchasing Accounts.
Reduction of SA Spend as a result of returns and other billing adjustments, where allowed, may result in the loss of Support eligibility or Phone incident awards during the present or future award periods.
As you approach your Unified renewal with Microsoft, here’s your game plan:
- Understand what is offered in each tier of Microsoft Unified Support and determine if it would meet your specific needs. US Cloud has broken down each level of Microsoft Unified Support service for you to help get you started.
- Follow our eight Microsoft enterprise negotiation tips leading up to and during your conversation with your Microsoft account manager. The shift to Microsoft Unified Support has also changed the way Microsoft approaches renewal conversations with you. Follow our Microsoft enterprise renewal tips now so you don’t get left behind.
- Look outside Microsoft for opinions on pricing and services. You don’t have to go it alone. There are a variety of ways to license/subscribe to Microsoft’s offerings and get support. Bring in unbiased expertise to assist you our sourcing team with vetting the recommendations and helping structure Enterprise Agreements (EAs), Software Agreements (SAs), and Support agreements that drive lower spend and higher utilization.
US Cloud can help you prepare for your Unified Support, EA and SA renewal conversations as well as provide you alternatives to Microsoft’s ever-increasing price tag for its support services. Make sure they can bring a high level of quality you need for your business-critical support, such as:
- Hours that never expire – Your support hours never expire with US Cloud, and since you’re only paying for the support you need, it allows you to make a smarter financial decision for your business without sacrificing quality.
- Billing on your terms – US Cloud offers subscription billing and installment options that meet your specific needs.
- 5x faster response – Microsoft Unified Support average response times hover around 30 minutes. US Cloud will respond to your ticket in 6 minutes.
- A white glove customer experience, every time – US Cloud won’t make you repeat your issue over and over again when we transfer you to the right experts to solve your issue. Our only goal is your complete satisfaction.
- Deep expertise in your specific business needs – Dedicated Technical Account Managers and Designated Service Engineers at US Cloud mean we quickly develop a robust understanding of your business and IT environment. You can depend on us to handle your specific issues the moment you have them instead of wondering if the right person will be available to take your inquiry and rectify your support inquiry.
- USA-based support – You will never be outsourced to a call center overseas. All US Cloud staff are located in St. Louis, Missouri, and meet the right levels of clearance for U.S. public sector entities.
- Two decades of Microsoft experience – US Cloud is a Microsoft Certified Partner and Cloud Solution Provider, meaning we are experts in the ins and outs of Microsoft technologies.