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How can Microsoft CSP partners maximize their profits by selling new CSP offerings?

4 Mins read

Over the last few years, the way customers purchase technology solutions has rapidly evolved. Today, they have several distractions like emails and content, as well as social media to divert them towards required solutions. In such a scenario, Microsoft partners need to rethink about their businesses. Of course, there are plenty of new opportunities as well, like Microsoft bringing new cloud services under its Cloud Solution Provider (CSP) program.

New offerings under the Microsoft CSP program

In May 2018, Microsoft announced the availability of Azure Reserved Virtual Machine Instances (RI) through its Cloud Solution Provider (CSP) program. Two months later, the tech giant also brought Windows Server and SQL Server subscriptions under the CSP program. This opened a path to new opportunities for Microsoft CSP partners.

  • Azure Reserved VM Instances (RI)

Microsoft defines Azure RI as a one- or three-year pre-purchase of cloud computing resources.

When the customers have a predictable amount of workload for one or three years, then they can choose to purchase Azure RI. Microsoft is offering significant savings with Azure RI versus the standard on-demand workloads.

The company claims that customers can save up to 72% as compared to pay-as-you-go Azure VM pricing if they purchase or reserve the VM for a one- or three-year period.

Azure Reserved Instances is a cost-effective option for commercial customers having predictable cloud workloads. For Microsoft CSP partners, it is a good opportunity to meet the demand of these customers.

  • Windows Server and SQL Server subscriptions

Partners can now also sell Windows Server and SQL Server subscriptions as part of CSP program.

One of the best thing about Windows Server and SQL Server subscriptions under the CSP program is that customers can now leverage the Azure Hybrid Benefit. When these subscriptions were not included in the CSP program, only customers with Software Assurance were able to gain the Azure Hybrid Benefit. Now, even the customers without Software Assurance can enjoy maximum savings on Microsoft server workloads.

Microsoft claims that customers can save up to 80% when they purchase a combination of Azure RI plus Windows Server and SQL Server subscriptions. They will also gain unmatched flexibility in deployment.

Why should Microsoft partners sell new offerings under CSP program?

Microsoft has added the Azure RI, and Windows Server and SQL Server subscriptions to its CSP program in a partner-friendly business model that not only increases profitability but also reduces the risk.

For instance, the modernized licensing will boost the predictability of cost, as well as streamline the sales process. Additionally, Microsoft CSPs will be able to acquire, provision and manage Azure RI and server subscriptions for commercial customers through Microsoft Partner Center and Azure Portal.

The new offerings will also expand the portfolio of IT management cloud services, which will enable CSPs to increase revenue and profitability.

There are several other benefits of selling new CSP offerings, like meeting the fast-growing demands of customers looking for cost-effective solutions, and support highly predictable and persistent cloud workloads.

Further, the partners get benefits from Azure incentive model to increase profitability. Since these solutions are commitment-based cloud offerings, the partners gain higher customer lifetime value.

Benefits of new offerings for customers

As mentioned above, the customers who choose to use Azure RI can save up to 72% on costs as compared to standard on-demand Azure VM. And the customers who purchase Azure RI and server subscriptions together can experience savings up to 80% as compared to an on-demand offering.

The customers can choose to exchange instances, location, and term length whenever they want. Further, Microsoft allows cancelation of Azure RIs.

How can Microsoft CSPs maximize profits while selling Azure RI and server licenses?

In today’s rapidly evolving and competitive market, things have become challenging and complex for service providers to meet increased customer demands and internal expectations to reduce service delivery costs.

Automation is the key for service providers to gain greater efficiency, scalability, compliance, and productivity while meeting customer expectations. However, several CSPs are still stuck with the traditional model and haven’t recognized the potential of automation.

  • Automate provisioning and billing of cloud services

Microsoft partners usually sell multiple cloud services. The management, consolidation, and monitoring of multiple services at a time has become very challenging for them. They need to maintain transparency in several processes, including resource management, updating customer details, billing and coordinating invoices on the go, etc. These could be daunting tasks for them if done manually.

Use of a cloud services delivery platform like RackNap can automate the complex processes like provisioning and billing of cloud services, managed services, and traditional services. RackNap is an ideal platform for direct CSPs, indirect CSPs, distributors, ISVs, telcos, web hosts, and other service providers looking to optimize their businesses.

Billing complexity is one of the biggest challenges for CSPs. To be able to bill the customers accurately and then manage the invoices consume their valuable time and impact the business processes.

CSP cloud billing

  • Sell cloud services in a bundle

Further, RackNap allows CSPs to bundle the cloud services- Azure, Office 365, Azure RI, Server licenses; managed services; ISV apps; professional services, and then sell them to customers.

  • Provide support to customers

As per the new set of requirements for Microsoft Tier-1 CSP partners, the Direct CSPs need to provide support to customers for cloud services with the response time of less than an hour.

On that front, RackNap comes with a ticketing tool to help partners manage the support. Other than these key features, the software also has back-end business functions management capabilities like management of sales and marketing, customer self-service, partner/reseller management, and inventory management.

cloud service providers Azure

  • Acquire new customers

It is becoming difficult for service providers to acquire new customers and retain them because of increased competition in the market.

RackNap helps partners with strategic digital marketing capabilities, by conducting several activities such as webinars, blogs, events, and social media campaigns. These activities successfully help partners in driving customer acquisition.

  • Reduce the cost of operations

Automation of billing and provisioning helps CSPs to effectively use the manpower in an organization. The self-service portal that comes with RackNap allows customers to manage their own services, so that CSPs don’t have to respond to common queries.

Suggested reading: Digital transformation helps telcos move from perish to flourish

Looking to accelerate time to market and stand apart from the competition? Book a demo today: https://www.racknap.com/book-a-demo/

For a 14-day free trial, click here.

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About author
Sabarinathan, SVP of RackNap heads product and technical delivery functions. He has over 18 years of experience in the IT industry with specialization in cloud services delivery. He believes that to be successful, cloud service providers need – right business strategy, right automation platform along with skilled manpower.
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