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Considering CSP? Here Are Some Things Microsoft Won't Tell You

Microsoft's Cloud Solution Provider program is growing rapidly, and that means growing pains. Potential CSPs should learn about some of the program's current challenges before making the leap.

• By M.S. Partner
• December 20, 2017

If you're one of the thousands of systems integrators (SIs) thinking about signing on to the Microsoft Cloud Solution Provider (CSP) model, here are some data points to consider that you won't find on Microsoft's marketing materials.

Field Confusion
There's still a ton of confusion around CSP with the Microsoft field sellers, and it's leading the sellers to advocate against CSP. Microsoft has made strides here. For example, CSP licenses are now paid commission like Enterprise Agreement (EA) licenses.

However, the Microsoft reps still aren't confident that they'll see the CSP revenue for their accounts flow to their commission statements. Microsoft's internal systems have difficulty tracking the sheer number of CSP transactions.

Disempowered Reps
CSP also limits the ability for Microsoft reps to discount a transaction. Basically, Microsoft offers a larger bundle of software to the client that's ready to deploy at the time. In return, Microsoft offers a discount to that client to close by a certain date. Creating that deadline frequently moves software deals to closure. With CSP, we're seeing that the clients purchase only what they need to immediately deploy next.

Non-Total Solution
The "total solution" has always been a Microsoft strength. A small or midsize business could get all of its software needs fulfilled by a single vendor on a single licensing platform. Today, CSP doesn't offer many of the licenses that the clients need. Even simple things like Windows Servers or Windows Client Access Licenses (CALs) must be purchased on an agreement outside of CSP.

Limited Marketing
Customers today do their own research. Microsoft has a ton of content on the Internet about why SIs should sell CSP, but almost nothing that talks about why this program is right for small businesses. Clients need this validation. On the other hand, searching for EA or MPSA brings up a ton of educational content for clients.

Web Portal Lockout
Microsoft provides an e-commerce portal for its partners who purchase directly from Microsoft for CSP. However, the portal won't service existing clients, only new ones, which makes no sense. Microsoft should make investments that ease the transactions for its SI partners, instead of making them source, manage and pay for another tool.

Volume Anti-Discounts
Midmarket clients with 200-plus employees are large enough to request and expect discounts from their vendors. Microsoft doesn't have any way to provide volume discounts today within CSP. This challenge is exacerbated in that the Business Plans max out at 300 users per plan. Growing customers will actually see their per-user costs rise rather than fall when they hit 300 users.

Many of these problems are growing pains in a fast-moving CSP program. We'd love to see Microsoft accelerate improvements, but for now, these are the challenges that potential CSPs should take into account.

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