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Big Changes for Microsoft Licensing for 2021- Are you Ready or Confused?

As an IT professional, it is essential to stay on top of and understand the Microsoft licensing terms and pricing changes and get a grasp on how they will affect your organization’s compliance and cost.

So, what are the big changes announced for Microsoft Licensing?

As an IT professional, it is essential to stay on top of and understand the Microsoft licensing terms and pricing changes and get a grasp on how they will affect your organization’s compliance and cost.

1- Subscription Licensing Only for Exchange Server

Microsoft is moving to subscription licensing from its open license program. New application server products coming from Microsoft in the second half of 2021 namely, Exchange Server will be offered only on a subscription basis.

How could this affect you?

This will mean big changes for organizations as they start their transition away from On-premise towards subscription models. Subscription-based licensing is likely to be offered by monthly or annual payments. If not renewed, the organization can still access their data, but they won’t be able to modify it. Commercial customers will no longer be able to opt for a perpetual licensing model. Academic and Government customers can continue to buy under Open beyond 31st December 2021.

2- Open Licensing Retires after 20 Years

Further to the subscription-based licensing announced above for exchange server, Microsoft will also be discontinuing their open licensing program and introducing new license only purchases in its place. Starting in January 2022, commercial customers won’t be able to buy new or renew software licenses or online services through the Open License program. These transactions can only occur through partners in the Cloud Solution Partner program.

How could this affect you?

This removal of open licensing will be a big deal for small and midsized customers (100-250 employees), that up to now were able to buy multiple perpetual licenses at volume price. But it seems that there is more to come and organizations of 500+ are just as likely to be affected.

“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.”  

Third party Archiving solution for Office 365

What could the new Microsoft Licensing changes mean for you?

At a glance, it looks like a potential increase to spend and much confusion. It seems the aim here by Microsoft is to simplify the purchasing process/experience for its customers, but unfortunately when it comes to Microsoft licensing nothing is ever going to be clear-cut.

As we draw closer to the new year, it is now more important than ever you stay on top of Microsoft changes and be ready for renewal conversations. Microsoft is sure to use your renewal date to persuade you into making the move to 0ffice 365, move to more expensive licensing, and/or Azure.

Microsoft 365 Licensing comes with compliance dangers

All organization are required to meet compliance standards with regulations, such as data retention, GDPR, CCPA, and FOIA as well as other data protection legislation. Organizations purchasing or forced to purchase O365 subscription licenses as mentioned above can easily face licensing compliance issues…. Meaning more cost.

Licensing compliance is still an issue for organizations despite the perception that “moving to the cloud” and purchasing 0365 subscription licenses could bring about compliance. The main issues being, are you fully compliant and what are the hidden costs?

So where are the hidden costs-

Hidden costs around licensing start to appear when organizations create a pick and mix of E1, E3 and E5 plans. A practice that we see quite frequently and is fraught with consequences. Achieving compliance with mix licensing without expensive add-on’s is impractical if not impossible.

Here are some reasons what organization’s end up with mix licensing;

  • Organizations purchase a standalone license for lower-level plans because users access features that are exclusive to higher-level packages.
  • The organization needs to purchase more licensing for add-ons or features that don’t come with certain licensing.  
  • The organization needs to purchase more licenses than the number of users because of certain circumstances, for example, development, testing, contract and temporary staff requirements.  

Plan ahead and avoid the traps.

Without careful planning and review of licensing plans, you can spend thousands to millions more than expected on Office 365 Licensing, Administration, Support and Subscription Expense. In many cases, the move to subscription pricing will accelerate many organizations move to the cloud. This can be a daunting prospect for many.

Waterford Technologies is here to hold your hand. A key question our customers ask is “how much data to bring?”. We can advise on whether to bring all data, partial data or no data. MailMeter Cloud can provide a safety blanket: a copy of all data is extracted into MailMeter before migration, giving users access to historical mail during the migration process and as a fall back if things go wrong or are delayed

Waterford Technologies can;

  • Save money on migration and renewals,
  • Avoid wasted spend on duplication and keeping unnecessary licenses,
  • Avoid upgrades to higher O365 plans & additional advanced compliance,
  • Stop over licensing or mis-licensing.  

Why it might be time to consider a third-party archiving solution

MailMeter’s Office 365 email platform provides easy access to email anywhere on any device not to mention greater collaboration ability and removes the need for an on-premise exchange server.

Avoid Single Vendor Dependency and always have the option to move away from Office 365 if required in the future. Waterford Technologies MailMeter Cloud provides a separate repository for your eDiscovery outside of your email tenant. With much of the workforce working in a remote environment, this is particularly important.

Understanding Microsoft licensing and cost has always been challenging, but luckily if you’re reading this post you’ve come across an organization who is here to help and support. We’re happy to help you navigate and reduce your licencing cost and start your journey to the cloud, reach out to set up a call.

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