Changes to the Microsoft Open License program

In September 2020, Microsoft announced that they were discontinuing the Open License model. Initially announced for commercial users only, Microsoft has extended this to include government, education, and non-profit customers.
Let's have a look at what this truly means to any existing users of this model wishing to purchase Microsoft licenses in the future.

What is the Microsoft Open License program?

To understand the change, we need first to know the history of the program.
Microsoft first launched this program over 20 years ago to accommodate organizations of up to 750 users, requiring a minimum commitment of 5 licenses.
This model gave small to medium-sized businesses the ability to purchase licenses and enjoy volume pricing discounts.
The confusion for most entities trying to purchase licensing is that this was one of three programs that, on paper, appear very similar.

Why the change?

Microsoft is attempting to simplify license purchasing.

What do we need to know about the changes?

The Open License program officially ends on 31 December 2021.
From 01 January 2022, the following options apply, depending on the specific scenario you have.

Perpetual software licenses without Software Assurance

Perpetual licenses are a one-off purchase to a specific software version.
Therefore any owned licenses are always entitled to be used.
For purchasing new licenses in this category, the preferred approach from Microsoft for these cases is that customers approach their reseller to discuss the best way forward on licensing.

Software licenses with Software Assurance

Software Assurance gives customers the ability to deploy the latest version of their licensed software packages.
Though the Open License program is officially ending on 31 December 2021, Software Assurance agreements and upgrade benefits will continue until their end date, even if after the program end date. Once the contract reaches maturity, there are two options available for renewal.
For Software Assurance perpetual licenses, the Microsoft Open Value is the recommended option.
For non-perpetual licensing, the Microsoft Open Value Subscription is the recommended option.
Once again, the preferred approach from Microsoft is that customers approach their license reseller for personalized planning.

Open License with online services

Should customers have any unassigned tokens at the end of the 2021 calendar year, they would still be able to assign and use them, as long as this occurs within five years of the token purchase.
From 2022, customers will procure additional tokens via Microsoft Open Value or Microsoft Open Value Subscription.

Conclusion

Microsoft has launched the Microsoft Customer Agreement to simplify license purchasing in response to customer feedback. The agreement is always up to date and consistent, whether purchasing with your reseller or directly from Microsoft. This new approach is a significant step forward regarding ease of understanding, purchasing flexibility, cost predictability, and license asset management.