How to Leverage Office 365 for On Premise Deployments

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You often hear an “expert” talk or write about dual access rights for the cloud. What does this really mean? Am I really getting a two-for one deal when buying Office 365? In this article, we will review two deployment options – Partner Hosted scenario and an On-Premise scenario and explain what you will need to purchase.

The question of the day – can you leverage your Office 365 licenses on premise? Short answer…yes, but don’t forget about the server license! Let’s provide an example to illustrate how this will work.

On Premise

In traditional licensing, a customer who owns an Exchange Server license must also buy a CAL (Client Access License) to access that Server.  Let’s say their business expands and they add new employees.  For the new employees, they decided to test the waters and move them to the cloud using Office 365 E3.   For the Online Service, it doesn’t matter how they bought Office 365, it could be though CSP or another program, the use rights remain the same; the E3 licenses have the CAL equivalency to access their on premise Exchange Server.  Secondly, in regard to the version of the server they can access with the CAL, the Product Terms states that users can access current OR previous versions of the Server.  One last statement, make sure you have the right Office 365 User Server License equivalent.   As an example, if you have Exchange Enterprise, the CAL equivalent is Exchange Plan 2.   Here is a good chart from Technet highlighting the plan equivalent to an on-premise CAL.

Partner Hosted

If you decide to buy Office 365 (E3 as an example) and for whatever reason (security, etc) you decided to leverage another 3rd party service provider to host the solution on your behalf, you can still leverage your Office 365 USL licenses the same way as if you were deploying on-premise.  In this scenario, you are not deploying in your own datacenter, but using a third-party.  Let me provide an example:

You purchased Office 365 E3 for every user at your company.  Your CEO has a good buddy who owns a small hosting company down the street.  He decides he doesn’t want to use  Microsoft’s data centers, he would rather give the business to his buddy.  You realize that the USL licenses that you purchased have the equivalency of an on-premise CAL.  All you need to do is buy the server licenses the same as if you were deploying out of your own datacenter.  The hosting provider, can now deploy your solution from his datacenter in a shared hardware, dedicated VM environment.  In other words, he can leverage License Mobility with Software Assurance benefit.

In either scenario, it does not matter how you buy Office 365, the key to remember is having a USL license by itself doesn’t grant you the dual access right, but owning a USL license and server does.

Thanks for reading,

CSP Man

New Announcements for Microsoft CSP and MPSA Programs

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Recently Microsoft announced that as of April 1, 2017, they will standardize all online services (OLS) durations to one year or less.  In other words, they will remove multi-year agreement programs for online services in the Microsoft Product and Services Agreement (MPSA for those playing at home). This applies to all Office 365, Dynamics 365, Windows, and all other OLS currently sold on MPSA.  What about Azure?  That was removed as of February 1, 2017.

Why the change?  I think it is to align programs.  One of the primary benefits of moving to the cloud is flexibility.  I think this move is good for the consumer and Microsoft.  For the consumer, it provides a way to migrate to the cloud without the long-term commitment.  For Microsoft, once you move to the cloud, you are almost always in the cloud.  There’s a lot of talk about moving to the cloud, very little talk about moving away from the cloud.  The reason?  Very few migrate away.  It’s like the mafia, once you think you are out, they drag you back in.

If customers want to purchase longer durations, they can still purchase it under the Enterprise Agreement (EA) or Open Value.  For all others, CSP, MPSA, direct, etc. its one year.  Existing customers with 2-3 year customers will not be affected according to the Microsoft Licensing Partner Guide.  It also mentions that if customers with multiple year agreements add new users after April 1, those users will have the same services subscription dates.  In other words, nothing will change.  Once they sign a new agreement, it will align to the new one-year model unless they purchase under the aforementioned Open Value or EA.

 

CSP Licensing 101

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Cloud Solution Program is a new way to purchase Microsoft cloud solutions from various types of partners within the industry.  In this article, we will review what is CSP, why CSP, and who can benefit from it.

In short, the Cloud Solution Program is a way to sell your own offerings and services along with Microsoft cloud (Office 365 as an example) to your direct customers.  Let’s say you own an IT services company who provides migration assistance for customers who purchased Office 365.  With CSP, you have the ability to sell Office 365 bundled with your own services as one simplified package to your end users.  Now you may be asking, Why would I do that?   There are various reasons for everything, but the primary reason is for partners to control the end-end purchasing, support, billing, and procurement of Microsoft cloud services.  Depending on which tier you qualify for, you can provide your customers with one simplified invoice.

There are two types of resellers for CSP.  Tier 1 and Tier 2.  For a full overview check out Microsoft Partner Video but below is a general summary.

Tier 1 – Direct relationship with Microsoft.  The reseller purchases from Microsoft who in return sells it to the end user.  Services is included in this package.

Tier 2 – Indirect relationship with Microsoft.  The partner can obtain CSP through their distributor, package it, sell it, and provision it.  They (the partner) controls the billing, support, and provisioning of the service.  This fits in well with the hoster provider community.

This is a good move if you are a Microsoft investor.  Microsoft (as the video illustrates)  allows partners to increase margins.  I agree, but I also think the real reason is it ensures the solution will be deployed.

I remember (and I am dating myself here) the Business Productivity Online Suite.  Microsoft account managers were highly incentivize to sell BPOS.  Some would throw it on a customer’s price sheet at zero cost so the customer would have no idea they were even “purchasing” it.  They were not compensated for the actual deployment.  When Microsoft ran the numbers, they sold thousands of seats of BPOS, but when they ran the real numbers, a very small percentage actually deployed it.  Cloud was a relatively new concept, and (as some are today) were concerned about security, migrations, etc.  The time to actually deploy was astronomical.  A customer in essence, could of “purchased” BPOS for free, never know they even had it on their price list, and actually purchase and deploy a competitors cloud offering.

Moving to this CPS model streamlines the process.  If you are a CSP reseller, you have to add services to your offering.  Without services, the customer could just purchase Office 365 through various licensing programs or even Microsoft directly.  Adding services as part of the requirement ensures Microsoft the products they are selling will be deployed.  Once deployed, it’s difficult to turn back.  In other words, once a Microsoft cloud customer, always a Microsoft cloud customer.  You could say the same with any other cloud provider.

If you have your own IT services company or hoster and become two tier authorized, you have the ability to really own the end customer through this program.  In the past, a company could receive Office 365 from a reseller, but use another company to provide the migration and implementation, and perhaps another company to consult on the licensing.  Under CSP, you can get all of that from one provider.

I like CSP, I think it makes sense in a lot of different scenarios.  If I was a hoster, I would embrace it, but I would also offer my own hosted services as a competitive offering.  If your customer demands Office 365, you  can do it.  If the customer wants your own version of Office 365, you can do that too.

For more information, I encourage you to check out the CSP portal found on the Microsoft Partner site as well as the CSP FAQ

Thanks for reading,

CSP Man