News

Microsoft Adds Software Assurance to Products and Services Agreement

• By Kurt Mackie
• 09/03/2014

Microsoft on Tuesday added the Software Assurance (SA) licensing option to its new Product and Services Agreement for midsize customers.

The Microsoft Product and Services Agreement (MPSA) is a new licensing approach for organizations with more than 250 users or devices that is being gradually rolled out, with global availability expected by the summer of 2015. For some customers, MPSA has been available since December of 2013, but it seems to have existed at the trial stage back then. Until now, the SA part of the MPSA had gone missing, but Microsoft announced its availability this week.

SA is an annuity option on top of Microsoft's licensing agreements that lets organizations move to the next software release, provided that the SA agreement is still in effect at the time of release. Organizations get some educational support resources with SA, too, but SA is thought to cost organizations about 25 percent to 29 percent over the price of the software license.

Microsoft had promised back in July to add its new Enterprise Mobility Suite licensing to the MPSA this month, but that detail wasn't announced. Enterprise Mobility Suite licensing, introduced back in March, adds mobile device management licensing permissions. It's a suite of licenses for Windows Azure Active Directory Premium, Windows Azure Rights Management Services and Windows Intune, which is Microsoft's mobile client device management solution.

MPSA Replacing Select Plus
Eventually, the MPSA will replace Microsoft's Select Plus licensing plan. Microsoft plans to phase out Select Plus on July 1, 2015, which is when it won't offer Select Plus licensing to new customers. Existing Select Plus customers won't be able to purchase additional Select Plus licensing on July 1, 2016. Organizations will be offered MPSA licensing instead.

The MPSA is promoted as simplifying the licensing process for organizations, with Microsoft claiming a "70 percent reduction in process steps." It may have cost benefits, too, according to Microsoft.

"We expect many customers to see savings compared to Select Plus through having all online services and software combined under a single agreement, and the easier capabilities to set-up a single, consolidated purchasing system that ensures all purchases are at the optimum price level for the size of organization," a Microsoft spokesperson explained back in July, via e-mail.

Many licensing experts haven't seen an MPSA contract, and it isn't available from Microsoft for review by the press. However, Scott Braden, senior vice president of value creation at global market consulting firm Net(net) Inc., characterized the MPSA as more of technical enhancement to Microsoft's licensing, rather than a radical shift.

"In past years, both enterprise customers and Microsoft have had struggles understanding and managing the various agreement types -- Open, Select/Select Plus, EA [Enterprise Agreement], EAS [Enterprise Agreement Subscription], etc.," Braden said in a July e-mail. "So it makes sense to have a single approach, which it seems like the MPSA is an attempt to at least start moving toward."

Braden noted that the MPSA allows large organizations to have "multiple independent buying entities" using the same MPSA contract, which can simplify the purchasing. He was less concerned about potential pricing differences with MPSA than with existing contract language.

"Changes to Product Use Rights (licensing terms) are typically poorly publicized and can have huge cost impacts," Braden said. "As an example, just review the SQL [Server] licensing and pricing changes of a couple years ago, which are still being felt by EA customers as their deals expire/renew."

Braden added that "so far, I haven't seen anything in the MPSA that will lead to cost increases or cause enterprise customers to have to reevaluate plans."

Dual Licensing Portals
As Microsoft's July 2015 phase-out of Select Plus licensing approaches, organizations possibly may face the inconvenience of having to deal with two different licensing portals to manage their contracts. Select Plus licenses get managed under the older Microsoft Volume Licensing Service Center (MVLSC), while MPSA contracts use a newer Microsoft Volume Licensing Center (MVLC) portal.

"Customers purchasing through the MPSA will see MPSA licenses through the new MVLC, while their older purchases made on MVLSC will still be accessed through the MVLSC," the Microsoft spokesperson clarified back in July. "We are evaluating options to provide visibility or access to older licensing through the new MVLC, and are gathering customer and partner feedback."