Describe the Pricing Model for Microsoft Cloud Services

Deciding which Microsoft 365 subscription to acquire is not a simple task. Organizations need to plan and consider the various business factors that will ultimately drive the purchase decision. The following list details the common aspects and decision points:

• Per user, rather than per device: For most cloud-based services, organizations should plan on acquiring licensing based on the users required rather than the device count. However, some industries or roles do rely on shared devices or equipment, so it is important to determine which models apply to you. Most organizations will require a mix of individual or user-based licensing, as well as shared or common device licensing. It is important to plan for identifying the number of individual users, as well as the number of shared devices, when estimating costs. While some very specific licensing agreements allow some organizations (such as Education customers) to license Microsoft 365 Appsonly (not other Microsoft 365 services) on a per-device basis, generally, Microsoft 365 products and services are licensed per user.
• Service family: Depending on your organization’s size, type, or region, you may be eligible to acquire different licenses. Some of the service families include Business (a maximum of 300 users), Enterprise, Education (only available for educational institutions), Government (only available to public sector organizations), and sovereign cloud environments such as Office 365 operated by 21Vianet in China or Office 365 Germany.

Further Reading

For more information on service families and availability, see the Microsoft 365 Plans pages at https://aka.ms/M365BusinessPlans and https://aka.ms/ M365EnterprisePlans.

• Standalone versus bundle: If your organization plans to use only one particular piece of Microsoft 365 software or an individual service, you may have the option to acquire plans for standalone services (such as Exchange Online, Microsoft 365 Apps, or SharePoint Online). As you choose services to acquire, however, bear in mind that bundled SKUs frequently provide better value. Most organizations choose to acquire bundles that include several services and provide a cost advantage.
• Bundle service availability: Not all services are available in an SKU bundle; bundles may have different levels of service associated with them. It’s important to evaluate the exact features that are driving the business decision so that you can purchase them accordingly.

• Short term versus long term: Even though licenses can be changed, whenever possible, organizations should attempt to predict what their users will need and plan accordingly to avoid surprise reconciliation bills at the end of their billing term.

After deciding on the user and service requirements, organizations can acquire licenses. Licensing and support agreements can be acquired through a number of channels. There are two core license acquisition models:

• Direct licensing refers to when an organization makes a direct purchase of Microsoft 365, such as through the Microsoft admin center or a direct relationship with a Microsoft account team
• Indirect licensing refers to when an organization makes a purchase through a partner or reseller agreement

For the purposes of the MS-900 exam, you will need to focus on three channels of licensing:

• Enterprise agreements

• Cloud solution providers

• Direct billing

You will now review them one by one.