Forum Discussion
Unified for Partners (UfP) - Pricing
We are a Microsoft Direct CSP currently purchasing Premier Support for Partners (PSfP). With Premier support we are allowed 30 cases/year and after that you have to pay approx. $650/case. We do a good job of handling issues on our own and only open tickets on our customers behalf as a last resort. We will have approx. 20 cases this year and won't need to purchase any additional.
Under (UfP), based on the datasheet released we will qualify for a 40% discount on the Licensing & Azure rates. With the 40% discount our annual costs will increase 8x what we are currently paying. Our cost/case will go up to $12,725(1,800% increase)
Is Microsoft trying to put their existing CSPs out of business with this pricing model? We have been driving new business and been a model partner. We have already had to deal with the complications of all of the risk and additional issues brought on by NCE and now we are going to be price gouged for support. The marketing materials are trying to make this look like a benefit to us when in fact it is the complete opposite.
Will there be exceptions to this new pricing model? It made a lot more sense to charge CSPs per case they open above the 30 allowed. Why wouldn't Microsoft just increase the cost of the additional cases? This would make CSPs double think about opening a case that they may be able to solve on their own. (UfP) is going to punish the good CSPs by spreading the cost of companies abusing the system across the board.
We would love to have the opportunity to express our concerns with a Microsoft representative in the CSP program. We have already made our PDM and Success Manager aware of the impact that this will have.
Thank you for your feedback NickG
I have shared it internally with the team and they are aware. Now to set expectations, I can share this feedback but I can't promise they will make any changes because of it. 🤩
The team has responded with:
The best place to direct partners with concerns here is to have them connect with their CSAM (The customer support account manager), who manages their existing contracts. They have the best accurate information to share.
I hope this helps a little bit and know that your feedback has been heard!
Best- jill
7 Replies
I'm waiting to hear back at the moment after emailing our CSAM, but you only have to have a bad month of having to open a few extra support tickets and that cost per ticket sky rockets as you lose discount. I'd like to know if you will get credit back for tickets where you open them and then its found to be a back end issue or a bug that needs to be fixed and you have no control over.
It's my understanding you can get credited back for those situations through your CSAM. They can't abuse that privilege though so you may only be entitled to a few credits back throughout the year.
Does the new unified pricing affect you negatively? For us it will be 8x what we are paying now and eat in to the already small margins we are making.
It’s a substantial negative for us for with no additional services that we would be looking to make use of. Initial calculations of probably 4x our current support costs. We are currently looking at our cost base and the impact is going to have on margins moving forward. Over the last few years we’ve been under cut by a number of partners of which some have been selling at below cost just to win the business. We have a number of customers that are licence only, but moving forward I don’t see how we will be able to do this on such tight margins already.
Our CSAM pointed us here to try and get the attention of other CSPs. We would encourage you to run your numbers sooner than later by using the UfP Partner Datasheet(attached) provided by Microsoft recently. If other CSPs are interested in banding together here and drafting up a more formal complaint please reach out.
For example: You are doing 10M in CSP revenue and it's split 50/50 between Licensing and Azure. You open less than 6 cases per 1M, so less than 60 cases a year. You then receive the best discount possible of 40%.
Azure - 5M*2.4%=$120,000
Non Azure - 5M*1.6%=$80,000
Annual cost for Unified support - $200,000 --> I'd bet this is a huge increase over Premier support and it only gets worse as your revenue grows up to 50M before you jump to the next tier.
Agree with Nick after doing some calculations based on TTM revenue for Azure/Non-azure.
The discount will be very important to retain some margin. Based on first calculations the cost of support could range from 1,59% of revenue down to 0,8% but this is still a massive (nominal) amount for CSP's in category C (100-500 Mio)
Raising the revenue while maintaining a low(er) case rate is the only way to keep the discount.
It appears the case rate value as displayed in Partnercenter (despite showing x.00 so two decimals) is actually rounded to a whole number. To get in the highest discount tier you need a case rate lower dan 6 as of course a rounded 6 isn't lower than six you would need to increase revenue/decrease # tickets to get an average below 5,5 where it flips to 5.
While in your calculation solution of choice, it might also be good to check how many customer surveys to send out to meet customer success survey requirement for the Support Services Designation. Sending out just 30 is definitely too low, one ⭐ will prevent you from achieving a passing score and that was needed to achieve the SSD, because without the SSD there is no discount at all....
- JillArmourMicrosoft
Community Manager
Thank you for your feedback NickG
I have shared it internally with the team and they are aware. Now to set expectations, I can share this feedback but I can't promise they will make any changes because of it. 🤩
The team has responded with:
The best place to direct partners with concerns here is to have them connect with their CSAM (The customer support account manager), who manages their existing contracts. They have the best accurate information to share.
I hope this helps a little bit and know that your feedback has been heard!
Best- jill
