Mastering Subscription Terms and Billing Frequency (NCE): Leveraging knowledge to your operations

This article is designed to provide valuable insights into effective license management within Microsoft's CSP solution. Discover best practices for managing subscription terms and billing frequency while leveraging the power of the CloudCockpit platform.

Introduction

Managing license terms and billing frequency is a critical aspect of maximizing operational efficiency within Microsoft's CSP ecosystem. By adopting streamlined processes and leveraging the centralized approach offered by CloudCockpit, businesses can gain control over their licenses and drive success.

License Terms

The new commerce experience (NCE) supports 1-month, 1-year, and 3-year terms for licenses but not all terms are available for all products. There are 1-month subscriptions as well as 1-year subscriptions available for M365 products, with 3-year subscriptions available for some Dynamics 365 products. You can easily consult CloudCockpit’s catalogue to see exactly which term durations are available for which products.

Pro tip:
We can add further licenses into the same active subscription, there are two benefits: the price is the same for yourself as well as for your partner, and the end date of all the individual licenses is controlled by the end date of the subscription, and thus they all align from a renewal perspective.

Billing frequency

The new commerce experience (NCE) supports upfront monthly, annual, and triennial (once every 3 years) billing. Partners can choose a billing frequency dependent on the subscription term, as shown in the table below:

Table 1 - Subscription term with billing frequency options
Source: Microsoft New Commerce Experience Handbook (release: 11-04-2023)

Subscription term	Billing frequency options
1 month	Monthly
1 year	Monthly or annual
3 years	Monthly, annual, or triennial

Balancing Risk and Discounts

It's important to consider the balance between discounts and associated risks when selecting a subscription term. While longer terms offer higher discounts, it's crucial to note that seat reductions are not possible during an annual term.

However, with CloudCockpit, mid-term changes to billing frequency are possible. You may be able to change the billing frequency midterm, dependent on the license term and billing frequency that you want to move to. In this case, changes are made immediately. If an option is not available, then you may be able to schedule the change to occur at renewal, as described in the following table:

Table 2 - Change to license term and billing frequency
Source: Microsoft NCE Handbook (release: 11-04-2023)

Original license term and billing frequency	Change to license term and billing frequency
	1 month, monthly	1 year, monthly	1 year, annually
Term: 1 month Billing: monthly	---	Immediately, or at renewal	Immediately, or at renewal
Term: 1 year Billing: monthly	At renewal only	---	At renewal only
Term: 1 year Billing: annually	At renewal only	At renewal only	---

Pro tip:
You don´t need to go all or anything in terms of license term and billing frequency. If you have for example a seasoned business, you can have both a monthly term and an annual term subscription for the same seat-based offer at the same time with the appropriate number of seats in each term to accommodate your permanent and seasonal employee. Which will allow you to balance the discount and risk of longer terms.

3 simple ways CloudCockpit can help you

1. Stay Ahead with Renewal Notifications: Stay informed about upcoming renewals, giving you and your customers time to decide on the best term and billing frequency. Receive timely notifications 30-60 days prior to renewal.
2. Auto-Renewal Control: Prevent unnecessary charges by easily managing auto-renewal settings through the platform.
3. Customer Self-Portals: Enable your customers to effortlessly explore different subscription scenarios, evaluating various terms and billing frequencies, while ensuring your business rules (e.g., margins) are applied. Streamline the evaluation process and enhance collaboration with your customers.

Conclusion

Mastering subscription terms and billing frequency in Microsoft's CSP ecosystem is crucial for achieving operational efficiency. Through the CloudCockpit platform, you can centralize and optimize cloud license management, simplifying processes and gaining better control over your subscriptions.