The impending price increase for Microsoft 365, set to take effect on March 1, 2022, is poised to become a crucial transition point for Managed Service Providers (MSPs).
Within this industry, many providers have successfully adapted to previous challenges by embracing digital transformation and enhancing customer security. However, some have lagged, resulting in slower growth. With more than 90% of MSPs reselling Microsoft 365, this upcoming pricing change presents both challenges and opportunities.
Adapting to Digital Transformation
In recent years, MSPs have experienced significant growth by quickly adapting to market shifts, particularly during the COVID-19 pandemic.
MSPs have experienced significant growth by quickly adapting to market shifts
Those who embraced change thrived, while others that were slow to adapt found themselves struggling. The anticipated Microsoft 365 price increase represents another such challenge that will require MSPs to adapt swiftly.
Navigating Microsoft Licensing Complexity
Microsoft's licensing programs often present complexities, even for seasoned IT professionals. As the new pricing rolls out, MSPs have the opportunity to clarify these complexities for their clients.
By understanding the various Microsoft 365 packages, MSPs can help clients choose the right plan. This involves considering features such as Litigation Hold, auto-expanding email archives, and sensitivity labeling, which are included in different licenses.
Opportunities for MSPs as Trusted Advisors
The role of a "trusted advisor" within MSP circles is an aspirational one that can now be realised. The impending price adjustments offer MSPs a unique chance to prove their expertise and advise customers on right-sizing their Microsoft 365 plans, focusing on cost-efficiency and necessary functionalities.
This advisory role could include reassessing a customer's use of other applications such as Zoom, which offers similar functionalities to Microsoft Teams.
Understanding Customer Needs
Most small and medium-sized businesses (SMBs) may not fully grasp which version of Microsoft 365
Most small and medium-sized businesses (SMBs) may not fully grasp which version of Microsoft 365—Business, Enterprise, or Office 365 for Enterprise—meets their needs.
MSPs can play a critical role in guiding clients through these choices, helping them streamline software use and cut unnecessary costs by utilizing existing features like Microsoft Teams over third-party applications like Zoom.
Upcoming Educational Opportunities
To assist MSPs during this transition, SaaS Alerts will focus educational efforts in February on comprehending the various Microsoft 365 plans, comparing features, and understanding pricing options.
This initiative aims to empower MSPs to optimise client protection and cost-efficiency and positions them advantageously amid these industry changes. Interested parties are encouraged to attend the Microsoft 365 Price Increase webinars on February 15th and 23rd, where they will be introduced to a new MSFT 365 calculator designed to navigate the upcoming price adjustments and evaluate margin scenarios.
“Win on the transition” is a term the author heard for the first time several years ago. The author has written about it and I have conducted numerous public presentations on the topic. Since then, they have observed companies both win and lose on “transitions” across various industries.
Some of these transitions are brought about by innovation, economic conditions, or, most recently, a worldwide pandemic. SAAS Alerts can all think of companies that have supercharged revenue and profits during COVID-19, while they have seen others wither away.
Digital transformation
Within the MSP industry, the author has witnessed some MSPs thrive in the last couple of years. They have adapted quickly to better secure their customers, and they have empowered digital transformation.
At the same time, other MSPs have been slow to evolve. As a result, they are either struggling or growing at a slower rate than their peers.
Change is Coming
How MSPs handle this price increase will prove to be a transition point for many
The author believes users are on the verge of another transition point in the MSP community. Over 90% of all MSPs resell Microsoft 365 and, in case users have not heard, Microsoft is implementing a price increase on 365 starting March 1, 2022.
How MSPs handle this price increase will prove to be a transition point for many.
Trusted advisors
For years, the term “trusted advisor” has been waved about in MSP circles as an aspirational title. While many have struggled to live up to this designation, MSPs are presented with an opportunity. They can become their customers’ “trusted advisors” with the impending Microsoft price increase that will affect most, if not all, MSP customers.
The MSFT licensing programs are very confusing and even most IT professionals have a difficult time understanding them. By understanding the new prices and the different plans, MSPs have an opportunity to right-size both the customers’ protection and their costs for the most widely used application in their stack.
MSFT 365 licensing package features
Several features are bundled into the different MSFT 365 licensing packages. Most people don’t even know or understand if they need them. Some of these features include:
- Litigation Hold
- Auto-expanding email archive
- Manual, default, and mandatory sensitivity in Office 365
- Sensitivity labeling for containers in Office 365
What the Price Increase Means for MSPs
Most SMB customers don’t understand whether they need MSFT 365 for Business, MSFT for Enterprise, or Office 365 for Enterprise. Beyond that, they will need to choose the Basic, Premium, or Standard versions of these products.
This price increase presents a great opportunity for MSPs to fully understand the differences in MSFT plans, including the features and costs associated with each plan. Most importantly, MSPs can determine how the customer can right-size functionality, protection, and cost.
Saves money
The foreign application most SMBs are logging into, with their MSFT 365 credentials, is Zoom
SMB customers expect thought leadership from their MSPs in understanding all of the software they use. They rely on MSPs to help them save money by eliminating redundant functionality across different products. In SaaS Alerts’ first SASI Report (SaaS Application Security Insights), released in June 2021, it found that the foreign application most SMBs are logging into, with their MSFT 365 credentials, is Zoom. But, SAAS and all know that MSFT Teams and Zoom do many of the same functions.
As an MSP seeking to be a trusted advisor, the author could use that information to propose that the customer discontinue using Zoom to help offset the MSFT price increase. Instead, the customer would use Teams, exclusively.
Comparisons, and pricing options
During February, SaaS Alerts is dedicated to better educating MSPs on the different MSFT 365 plans, feature comparisons, and pricing options to help every MSP right-size their customers’ protection and cost. The goal is to share practical insights to help every MSP become a trusted advisor and “win on the transition.”
To that end, SAAS Alerts invites users to join them for the Microsoft 365 Price Increase webinar on February 15th or February 23rd. In addition to gaining these insights, every attendee will receive access to our new MSFT 365 calculator. This calculator incorporates the price increases and it includes options for different margin expectations.
