Microsoft is looking to gain ground in the cloud by way of Azure – their cloud platform that claims seamless integration of their on-premise and cloud solutions. “The Cloud” is the big sexy term in today’s IT world as exhibited by all the major vendors. With Microsoft’s considerable presence in the desktop and server space, it’s only natural for them to make a push into the cloud with the intent on capturing significant market share.
For many customers, furthering standardization within the IT landscape can be an attractive proposal. Microsoft obviously knows this and they’ve already begun the effort to sway customers towards Azure with attractive pricing. They are positioning Azure as the platform that will tie not only Microsoft’s on-premise and cloud solutions, but also third party cloud solutions. We would like to take this opportunity to emphasize one of the major negotiation leverage points with Microsoft – a desire to adopt their new technology. This may be even truer when it comes to cloud subscriptions considering how difficult it is to migrate to a new cloud solution once committed, giving Microsoft more incentive to offer concessions to execute deals and capture market share.
In recent deals we have seen Microsoft tie in Azure with their new Server and Cloud Enrollment (SCE) as part of Dynamics and Desktop Enterprise Agreement renewals. While SCE has some pricing and standardization benefits, what it really does is further guarantee your commitment to Software Assurance (SA) enterprise-wide. Microsoft cares far more about getting customers locked into SA than they do a few percentage points on a subscription discount. They’ve done the math and realize it is in their best interest to offer additional discounting on SCE products if it means guaranteed downstream revenue and growing their footprint within IT environments. Thus, it is imperative to strategically position with Microsoft your willingness to commit to their new technology and licensing packages – provided Microsoft is willing to provide a highly compelling commercial deal construct. Know that after the initial term is over, without protections, you will be starting from square one at the negotiation table. Now is the time to maximize your leverage and get the pricing right!
We have a comprehensive history of bringing this and other leverage points to light and utilizing them for maximum savings. With the right intelligence and preparation, the David-versus-Goliath negotiation matchup with Microsoft becomes quite manageable. If you have an upcoming Microsoft renewal and would like help determining your leverage points, don’t hesitate to get in touch with UpperEdge, it’s what we do.
If you would like to discuss any of this in more detail, including how we have helped many organizations similar to yours navigate these complicated and often stressful discussions with Microsoft, please feel free to email me at [email protected].