Volume Licensing vs CSP — which is right for your business?

The short answer

• Under 250 seats, mostly cloud → CSP (Cloud Solution Provider) via a reseller like ELITE.
• 250–1,000 seats, mixed cloud + on-prem → CSP or Open Value (depending on whether you want Software Assurance).
• 1,000+ seats with predictable spend → Enterprise Agreement (EA) direct with Microsoft.
• One-off perpetual purchase (e.g. Office 2024 LTSC) → Buy outright through a reseller; no agreement required.
• Education / charity → Microsoft Customer Agreement for Education / Open Value Subscription Education.

CSP — Cloud Solution Provider (the modern default)

CSP is Microsoft’s primary channel for subscription products (Microsoft 365, Dynamics 365, Azure). You buy through a CSP partner like ELITE, not directly from Microsoft. The partner handles billing, support, provisioning and licence reassignments.

Pros

• Monthly or annual billing — no upfront commitment.
• One UK partner, one UK VAT invoice, named account manager.
• First-line support from the partner.
• Mix and match per-user plans for different staff groups.
• Easy to add seats mid-term; reductions follow NCE rules (see below).

Cons

• Annual-term CSP licences can’t be cancelled mid-term under New Commerce Experience (NCE) rules. Monthly-term costs ~20% more but is reducible.
• No long-term price lock (subject to Microsoft list changes).

NCE (New Commerce Experience) — the 2024 rules in plain English

In 2022 Microsoft moved CSP onto NCE. The rules every buyer should know:

• 72-hour cancellation window — you can fully cancel within 72 hours of purchase, prorated refund.
• Annual term = locked — after 72 hours, an annual seat cannot be reduced until renewal. You can still add seats.
• Monthly term = flexible — cancel or reduce any time, but ~20% premium.
• Triennial term — 3-year price lock, otherwise same as annual.
• Mixed terms allowed — e.g. put core staff on annual and seasonal hires on monthly.

Open Value (and Open Value Subscription)

Open Value is the on-prem volume programme for 5+ devices/users. You commit to 3 years of payments; in return you receiveSoftware Assurance (free upgrades, extended downgrade rights, training vouchers, planning services).

• Open Value: perpetual ownership after 3 years of payments.
• Open Value Subscription: subscription-style payments, no ownership at the end — usually cheaper.
• Suited to businesses still running Windows Server / SQL Server on-prem at scale.

For most UK SMEs, CSP has overtaken Open Value because most of the spend has shifted to Microsoft 365. Open Value still makes sense if you need Software Assurance benefits (e.g. licence mobility for SQL Server VMs).

MPSA — Microsoft Products and Services Agreement

MPSA is a transactional licensing agreement for medium to large organisations (typically 250+ users). It’s a perpetual, non-expiring agreement — you sign once, then buy on demand under it. Pricing is based on lifetime spend across the company.

Use MPSA when you have multiple business units, want centralised reporting, and don’t want a fixed-term commitment like Open Value or EA.

Enterprise Agreement (EA)

The traditional choice for 500+ seat companies. Three-year term, annual true-up, lower per-seat pricing, and you get a Microsoft account manager. Includes Software Assurance.

• Minimum 500 users/devices (lowered from 2,400 a few years ago).
• Direct from Microsoft (not via a reseller).
• Best per-seat pricing.
• Big lift in admin overhead — you need a procurement team and a Microsoft Licensing Specialist on retainer.

Perpetual (one-time purchase)

The classic “buy a key, own it forever” model. Still available for:

• Office 2024 Home, Home & Business, Professional, LTSC.
• Windows 11 Home / Pro / Pro for Workstations.
• Windows Server 2025 + matching CALs.
• SQL Server 2025 (Standard / Enterprise).
• Visual Studio Pro / Enterprise (also available by subscription).

No subscription, no renewal. Suited to fixed-purpose machines, air-gapped sites, regulated environments, or buyers who want a capital expense instead of OpEx.

Software Assurance — is it worth it?

Software Assurance (SA) is the “maintenance fee” that comes with most volume programmes. It costs roughly 25-29% of licence price per year and includes:

• New version rights — upgrade to the next major release at no extra cost.
• Licence mobility — move SQL/Exchange/SharePoint workloads between physical servers and clouds.
• Roaming Use Rights — use your home/work Office desktop apps remotely.
• Planning Services days — Microsoft-funded deployment workshops.
• Training Vouchers.

SA is worth it if you actually use those entitlements. If you buy perpetual and don’t plan to upgrade for 5+ years, the maths usually says “skip SA”.

Decision matrix