News

End of Microsoft's Open License Program Leaves Door Open for CSPs

• By Kurt Mackie
• October 01, 2020

Microsoft's 20-year-old Open License program for small and midsize organizations will be phased out in just over a year, leaving a crucial role open for Cloud Solution Provider (CSP) partners to fill.

On Monday, Microsoft announced that it won't be possible for organizations to purchase Open License offerings as of Jan. 1, 2022. Organizations with existing Open License program licensing also won't be able to renew that licensing on that date.

This plan to end the Open License program right now just pertains to Microsoft's commercial customers. However, Microsoft expects to "announce our plans for other agreement types in the coming months."

Here's how the announcement explained the coming end of the Open License program:

You can continue to renew and purchase new software licenses, Software Assurance, and online services through the Open License program until December 31, 2021. As of January 1, 2022, commercial customers won't be able to buy new or renew software licenses or online services through the Microsoft Open License program. New license-only purchases should be transacted through partners in the Cloud Solution Provider program. 

Some Open License program participants may have purchased "tokens" to use Microsoft's online services. Those tokens will remain "active for five years from the purchase date," the announcement explained.

Cloud Solution Provider Partner Role
Microsoft Cloud Solution Provider (CSP) partners will be the partners that will offer perpetual licenses after the end of the Open License program. Perpetual licenses are pay-once, non-subscription licenses that don't expire.

If organizations are using Software Assurance (SA) with those perpetual licenses, which lets them migrate to the latest software release, then they'll only be able to buy SA through a program different from the Open License program in 2022. The announcement recommended a switch to the Open Value program, which has an SA option for perpetual licenses.

The announcement also touted the Open Value subscription as offering an SA option, although it doesn't offer perpetual software licensing.

Enhanced Commerce Experience
Microsoft apparently is dropping the Open License program as part of a series of changes called the "enhanced commerce experience," which was announced last year to Microsoft's partners.

From a partner perspective, Microsoft deems it is empowering its CSP partners to sell perpetual software licenses (without SA), starting in January 2021, per an undated Microsoft partner blog post. It also claimed there are "more than 90,000 participating companies" in its CSP program.

The enhanced commerce experience also added the Microsoft Partner Agreement last year for partners, which replaced the Microsoft Cloud Reseller Agreement and the Microsoft Cloud Distributor Agreement.

On Nov. 1, 2019, the enhanced commerce experience delivered the Microsoft Customer Agreement for organizations, which replaced the Microsoft Cloud Agreement for customers buying through the CSP program. The Microsoft Customer Agreement is a new digital buying approach for organizations. It's vaguely described in this announcement.