Understanding the Azure Plan vs. Microsoft Azure

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Microsoft Azure (Class Azure) will be available through Nov 1st, 2020. Microsoft MSP and CSP partners are currently transitioning their Azure customers to the Azure plan and the modern commerce infrastructure before the deadline.

Partners purchasing a new Azure offer in Partner Center must choose between Microsoft Azure or the Azure plan. Partners will not be able to provision both offerings at the same time.

Provisioning the Azure plan

Partners choosing the Azure plan must ensure the terms of the Microsoft Customer Agreement are accepted. Resellers will have one-time provisioning of the Azure plan per customer via Partner Center. The Azure plan acts as a container for all Azure subscriptions. When the Azure plan is provisioned, an Azure subscription underneath the Azure plan is created by default.

  • To provision additional Azure subscriptions, Partner’s would NOT provision additional Azure plans. Instead, additional Azure subscriptions can be created under the customer’s existing Azure plan through the Azure Management Portal.

Transitioning a Microsoft Azure subscription to the Azure Plan

  • If customers have existing Microsoft Azure subscriptions, Partner resellers will need to transition those subscriptions to the new Azure plan.
  • Partners transitioning the original Microsoft Azure offer to the Azure plan can initiate the transition directly in Partner Center. There is no customer action required.
    • In the Partner Center, there will be a button on the Microsoft Azure subscription to transition to the Azure plan. After hitting the button, the Partner Center will direct Partners to the Azure Management Portal for the transition to be processed and completed.

Managing Azure Resources for PEC (Partner Earned Credit)

  • To earn PEC on Azure plan subscriptions, Partners must, at minimum, have AOBO (Admin On Behalf Of) Access at the resource level.
    • Direct CSP Partners or Indirect Providers provisioning new Azure subscriptions are automatically assigned AOBO rights to perform administrative tasks on the customer’s Azure AD tenant on behalf of the customer.
      • Customers do not have admin rights unless provided by the Partner; however, customers do have the ability to remove a Partner’s AOBO access.
      • Indirect CSP Partners: For Indirect CSP Partners to gain access, their Direct Providers must give AOBO rights to the Indirect CSP partners.
  • Azure resources can also be managed through RBAC (Role-Based Access Control):
    • RBAC is assigned to specific users where the appropriate RBAC roles can be assigned at the resource level (ie. resource, resource group, subscription).

The Impact

Classic Azure was billed to Microsoft partners at a discount (usually 15%). This discount was the retail margin that partners were expected to markup the reported usage summary to create a customer-facing invoice. However, with Azure plan the Microsoft invoices the partner(reseller) the full retail amount without any margin. Microsoft will later provide a Partner Earned Credit equivalent to the resale margin 2 months later based as a credit on the invoice as mentioned above. What this is means is if you are transitioning existing Azure subscriptions to Azure Plan

  • Be sure to review the markup percentage on existing customer subscriptions. If you retain the original markup you are going to be potentially overcharging your end customer.
  • Review your default margin that is applied for new Azure subscriptions through the configuration in Work 365
  • Daily Usage data is no longer available the same way as it was for Azure Plan (your customers will not be able to view consumption the same way.
  • Be sure to adjust all your billing dates as the G invoices will be available for the entire previous calendar month.

Using a billing automation solution like Work 365 reduces and even eliminates the complexities around the Microsoft CSP Partner program.

Learn more about how Work 365 can help you!


By Ismail Nalwala (contact me)

I am a Dynamics 365 enthusiast. I enjoy building systems and working with cross-functional teams to solve problems and build processes from lead generation to cash collection. Work 365 is a global developer of the Billing Automation and subscription application for Dynamics. Helping companies to streamline business processes and scale their recurring revenue.

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