Navigating the Risks of a Microsoft Enterprise Agreement: Software Assurance

By Jeff Muscarella

EVP of IT and Telecom Division, NPI

October 09, 2014

Interested in learning more about NPI’s services?

Contact Us

Remember when it didn't take a rocket scientist to navigate a Microsoft Enterprise Agreement? Times certainly have changed. What used to be fairly straightforward perpetual licensing became considerably more complex when Microsoft began adding “strings” to its software assurance (SA) maintenance model. As a result, the task of figuring out whether it makes financial sense to maintain SA on some or all of your Microsoft estate has become herculean.

In order to decide you have to answer (at least) the following questions:

  • 1) Which versions of MSFT’s desktop, server and collaboration products do we use and how long might we be happy staying on those versions? Of course the answer will likely vary by product (e.g., many organizations are very happy with Windows 7 and Office 2010 or 2013, but they may want the more powerful features of newer Exchange and SQL server editions).
  • This means you have to model out the quantities and costs, by product, for 3, 5 or perhaps 7 years, to begin to see which combinations of products and timing make sense for your organization.
  • 2) Where, when and how is SA required by Microsoft? You need to understand the intricate dependencies between SA and Product Use Rights for many MSFT products. Need virtualization in your data center? You probably need SA on your SQL servers. Want to deploy VDI? You need Office Roaming rights. Want to use MDOP, you need SA on the Windows OS…and the list goes on.
  • 3) Will a Select Agreement versus an Enterprise Agreement impact your SA requirements? You can buy certain products on either a Select Agreement or the Enterprise Agreement. But, you won’t get much discounting on Select, and some products like the eCAL require SA no matter which agreement is used.
  • 4) What about the cloud? This adds another layer of variables to consider. When might you move to O365 (e.g. after your current SA benefits on Office end? 5 years out?, etc.)? What are the costs of the user-based licensing model as compared to the EA model? How do the numbers play out for Azure (yet another use/pricing model)?
  • 5) How can you determine whether the pricing tiers and discounts offered by Microsoft are in line with peer purchases in the market?

As you can see, Microsoft has made it nearly impossible to answer the “SA or no SA?” question. One mistake can lead to true-ups or audits when you under-buy, and no ability to “true-down” if you buy too much.

That’s one reason why firms like Gartner are recommending that buyers tap into software licensing experts in addition to technical and legal experts when entering into any enterprise license.

If you’re negotiating a Microsoft EA or determining if you need to right-size SA on your Microsoft estate, don’t go it alone!