Microsoft EA vs CSP: Comparing the Pros, Cons, and Costs for Your Organization

Microsoft EA vs CSP: Comparing the Pros, Cons, and Costs for Your Organization

Introduction: EA vs CSP – Why the Decision Matters

Choosing between a Microsoft Enterprise Agreement (EA) and the Cloud Solution Provider (CSP) program is a pivotal decision for organizations. Microsoft licensing has shifted in recent years toward more flexible, cloud-based models.

Many CIOs and IT procurement leaders are now weighing EA vs CSP to find the best fit for their budget and business needs.

This choice affects not only Microsoft licensing cost comparisons but also flexibility, support, and negotiation leverage with Microsoft.

In this advisory guide, we’ll compare Microsoft Cloud Solution Provider vs EA in depth, exploring the pros, cons, and real-world cost scenarios, so you can determine which path (or combination) makes the most sense for your organization. Read our complete guide to choosing between Microsoft EA and CSP.

Enterprise Agreement (EA) Recap

The Microsoft Enterprise Agreement (EA) is a traditional volume licensing contract designed for large enterprises (generally 500+ users or devices).

An EA is a three-year commitment where the organization agrees to license certain core products (like Microsoft 365, Windows, or Office suites) for all eligible users enterprise-wide.

In exchange for this commitment, Microsoft provides benefits such as volume-based discounts and fixed pricing for the term.

Key characteristics of an EA include:

• Multi-Year Locked Term: You sign on for 3 years, which locks in pricing and terms for that period. This means your per-user pricing is fixed and protected from Microsoft’s price increases during the term.
• Up-Front Volume Pricing: Traditionally, EAs offered tiered volume discounts (Levels A, B, C, D) — larger user counts yielded bigger discounts on Microsoft’s price list. For example, a company with 5,000 seats might historically get a better per-license price than one with 600 seats. (Note: Microsoft has been evolving pricing, and recent changes mean cloud services under EA are moving toward standard list pricing for all customers. Still, large EA customers can often negotiate custom discounts.)
• Annual True-Up Process: With an EA, you start with a baseline number of licenses and can add more as needed throughout the year without immediate penalty. Instead of paying right away for each added user, you report any increases once per year at the anniversary (this is the “true-up”). You’ll then pay for those additional licenses for the remaining term. This true-up vs CSP monthly billing difference is important: the EA true-up offers some flexibility for growth (you get a float on added users until true-up time), but it doesn’t let you reduce licenses during the term. If your user count drops, you generally can’t scale down an EA until the 3-year term is over.
• Software Assurance and Enterprise Benefits: EAs usually bundle in Software Assurance (SA) benefits – things like rights to new product versions, training credits, and support resources. Enterprises also often get a direct Microsoft account team and access to programs or planning services as part of being an EA customer.
• Best for Large, Stable Environments: An EA is most effective for organizations with 500+ users that remain fairly stable or continue to grow. The enterprise-wide coverage ensures that everyone is consistently licensed. If you have a predictable user base and plan to standardize on Microsoft’s products broadly, the EA provides cost predictability and some savings in exchange for your long-term commitment.

In summary, the Enterprise Agreement is about committing to Microsoft at scale for three years to get predictable pricing and historically lower per-unit costs.

It’s like locking in a bulk purchase agreement. Next, we’ll contrast this with the Cloud Solution Provider model, which takes almost the opposite approach to commitment and flexibility.

Cloud Solution Provider (CSP) Overview

The Cloud Solution Provider (CSP) program is Microsoft’s modern, cloud-focused licensing model sold through partners (and also directly via Microsoft’s website for some customers). Instead of a long-term contract, CSP operates on a pay-as-you-go subscription basis, typically billed monthly.

In CSP, you work with a certified Microsoft partner who manages your licenses, billing, and often provides support.

The Microsoft partner CSP model is designed to be more flexible and accessible, particularly for smaller or mid-sized organizations and those with changing needs.

Key features of CSP include:

• Monthly or Annual Subscriptions: Under CSP, you can add or remove licenses on a month-to-month basis. A multi-year agreement does not bind you. (As part of Microsoft’s New Commerce Experience, you also have the option to lock in a 1-year or 3-year subscription for a specific license to secure a better price, but it’s not required. Pure month-to-month licensing is available at a slight premium cost.) This means you can scale your license count up or down as needed, providing much more agility than an EA.
• Standard Pricing (List Prices): CSP pricing is generally based on Microsoft’s regular list prices for each product. Unlike an EA, there are no automatic volume discount tiers for buying more seats – whether you purchase 20 seats or 2,000 seats, the base price per license is usually the same in CSP. Some CSP resellers might offer a small discount or promotional pricing (since partners get a margin from Microsoft, sometimes they pass a bit of savings to you), but you shouldn’t expect the deep discounts that a large EA might negotiate. Essentially, CSP trades volume discounts for flexibility.
• Partner-Managed Support: In a CSP arrangement, your partner is your first point of contact for support and service needs. A good CSP partner will handle routine support issues, provisioning, and billing inquiries for you, often at no extra charge. Many partners include basic support in their offering (and will escalate technical issues to Microsoft if needed). This can actually be an advantage for some customers: you get more personalized, responsive support from a partner who knows your environment, potentially faster than opening cases directly with Microsoft. However, it also means you have an extra party in the mix, rather than a direct enterprise support relationship with Microsoft, as in an EA (we’ll discuss this trade-off more later).
• No Minimum Seat Requirement: There is no 500-user minimum to use CSP. It’s open to organizations of all sizes – from a 10-person startup to a Fortune 500 company. In fact, many enterprises that don’t meet Microsoft’s evolving EA minimums (or whom Microsoft encourages to move off EA) will go to CSP or a similar Microsoft Customer Agreement/CSP route. This makes CSP ideal for mid-market companies and any business that doesn’t want a big upfront commitment.
• Best for Flexibility and Variable Needs: CSP excels for organizations with dynamic or unpredictable license requirements. If you have seasonal workers, frequent onboarding/offboarding, project-based contractors, or are in a high-growth (or uncertain) phase, CSP ensures you only pay for what you actually use that month. It’s also useful as a stopgap or trial – for example, if your EA term ended and you’re not ready to commit to another EA, you could temporarily move to CSP for a few months or a year without locking in long-term.

In a nutshell, CSP provides a flexible, subscription-based approach to Microsoft licensing. It’s like having a month-to-month plan where you can dial usage up or down, versus EA’s “lock in and get a bulk rate” approach.

Next, let’s dive into the specific pros and cons of each model.

Pros and Cons of Enterprise Agreement (EA)

Pros of EA:

• Predictable Pricing & Budgeting: With an EA, you get fixed pricing for three years. This price protection means even if Microsoft raises prices annually (which they often do), your rates stay the same until your EA comes up for renewal. For budgeting purposes, this stability is gold – no surprise spikes in year two or three.
• Volume Discounts & Savings: Enterprises signing an EA often enjoy volume-based discounts off Microsoft’s list prices. Especially for very large deployments, an EA can bring significant per-user savings. For instance, big companies historically saved anywhere from 15% to 30%+ compared to retail pricing thanks to tiered discounts and negotiated deals. Even as Microsoft standardizes pricing, large EA customers can still negotiate special pricing or get credits and incentives that aren’t available in CSP.
• Enterprise Support and Benefits: EA customers typically have a direct relationship with Microsoft. You likely have a Microsoft account manager, and you’re eligible for benefits like planning services, training vouchers, and sometimes even Microsoft-funded deployment assistance. While Microsoft’s premium support (like Unified Support) usually costs extra, the EA makes it easier to engage Microsoft’s resources. You also get Software Assurance benefits that can add value (e.g. free upgrades, home use program, etc.).
• Simplified License Management (Enterprise-Wide): If you truly want to standardize Microsoft software across your whole organization, an EA is convenient. You make one agreement that covers all users for core products, and you only adjust counts once a year. It’s straightforward to stay compliant because the assumption is that everyone is covered. This one-contract approach can simplify life for large IT departments.
• Cost-Effective for Stable Growth: If your organization is steadily growing or static in size, an EA can be cost-effective. You can add users during the year and only pay at true-up time, effectively getting a short-term free ride on those added licenses until the anniversary. And if you rarely need to remove licenses, you won’t mind the lack of downsizing flexibility. In other words, for a stable or growing workforce, you won’t be paying for lots of unused licenses, and the EA’s lack of flexibility isn’t a big drawback.

Cons of EA:

• Rigid 3-Year Commitment: The flip side of a long-term commitment is a lack of flexibility. Once you sign an EA for, say, 1,000 users, you’re effectively stuck paying for those 1,000 licenses all three years, even if your needs decrease. You generally cannot reduce your license count until the EA term ends. This rigidity can lead to shelfware (licenses you paid for but aren’t using) if your organization downsizes or shifts priorities. It’s a classic vendor lock-in scenario – great when you’re expanding, painful if you need to cut back.
• Large Upfront Spend & True-Up Surprises: An EA usually involves a significant financial commitment. You’re either paying annually for a big block of licenses or all upfront. If you underestimate usage, the annual true-up can bring an unexpected bill for additional licenses you added. If you overestimate, you’re overpaying for unused capacity. True-ups also only allow increases – not decreases – so there’s no relief for over-commitment. This model can potentially waste budget on unused licenses in a rapidly changing organization.
• Less Granular Control: Because EAs are all-or-nothing enterprise deals, they lack the granularity of picking and choosing who gets a license. You agree to cover everyone with certain products, which could be overkill for some users who might not need the full bundle. While you can have different profiles (e.g., a mix of E3 and E5 licenses), the EA philosophy is broad coverage, which might not perfectly align with actual usage patterns.
• Separate Support Costs: Remember that direct Microsoft support we mentioned as a pro? The catch is that true enterprise-grade support (like Microsoft Unified Support) is not included for free with an EA – it’s an extra contract (and often a pricey one). So while you have the benefit of Microsoft’s attention, you might still need to budget separately for support plans. In CSP, by contrast, basic support is often bundled by the partner at no additional cost.
• Less Agility in Adopting New Tech: If Microsoft launches a new product or service mid-term, EA customers might have to wait until renewal or go through a contract amendment to get it included, whereas CSP customers can just add it for a subset of users. The EA’s fixed structure can make it slower to pilot or adopt new Microsoft services on the fly (unless you’re willing to incur extra costs outside the EA).

Read our checklist on how to change agreements, Switching from an EA to CSP or MCA: A Transition Checklist for a Smooth Change.

Pros and Cons of Cloud Solution Provider (CSP)

Pros of CSP:

• Ultimate Flexibility to Scale: The biggest selling point of CSP is its flexibility. You can increase or decrease licenses month by month as your needs change. Bringing on 100 contractors for a project this quarter? Add 100 licenses for a few months, then drop them when the project ends. You pay only for what you actually use. This agility prevents overspending on unused licenses and is ideal for organizations with fluctuating workforce or cloud service needs. It’s a clear CSP flexibility vs EA commitment win for CSP.
• No Long-Term Commitment: With CSP, you aren’t locked into a multi-year deal. You can essentially cancel or adjust at any time (barring any 1-year subscription choices you made for savings). This is helpful if you want to avoid vendor lock-in or keep your options open. For example, if your EA is ending, you could move to CSP for a while instead of renewing immediately, giving you breathing room to assess your next move. Think of CSP as the “on-demand” model for Microsoft services – much like how cloud infrastructure is bought on demand.
• Simple Monthly Billing & Cash Flow: CSP typically consolidates your usage into one monthly bill (through your partner). This pay-as-you-go billing can be easier on cash flow and provides immediate visibility into what you’re spending each month on licenses. There’s no massive upfront payment or yearly true-up hit – it smooths out the expenses. It also means if you cut 50 licenses one month, next month’s bill is automatically lower, no waiting for an annual reconciliation.
• Partner Support and Services: In the CSP model, you often get more than just licenses from the partner – you get service. A good Microsoft CSP partner will include support for no extra fee and may offer value-adds like migration assistance, user training, or even slight discounts to win your business. They essentially become an extension of your IT team for Microsoft cloud management. Many organizations appreciate having a “one throat to choke” – a single partner to call for any issues or changes, who in turn deals with Microsoft on your behalf. This can result in faster, more personalized support compared to navigating Microsoft’s support channels on your own.
• Quick Access to All Microsoft Cloud Services: CSP is a convenient way to get any Microsoft cloud product under one agreement. Need some Azure usage, Dynamics 365 licenses, or Power Platform seats in addition to Microsoft 365? A partner can set all those up through the CSP program quickly. There’s no need to negotiate a new EA amendment or sign a separate contract for a new product line – you just ask your partner to add it, and it shows up on your next bill. This broad product coverage with minimal red tape is a plus for rapidly evolving needs.

Cons of CSP:

• Potentially Higher Per-User Cost: Flexibility comes at a price. On a pure per-license basis, CSP can be more expensive than EA for the same product, especially at scale. Since you’re generally paying list price (and if you opt for month-to-month subscriptions, there’s roughly a 20% premium for that flexibility), a company with thousands of users could see higher annual costs in CSP than if they had an EA discount. For instance, if Microsoft 365 E3 costs $36 per user/month at list price, a large EA might have gotten that down to, say, $32. Over thousands of users, that difference adds up. So if your user count is stable and large, CSP will typically cost more over time than a well-discounted EA. CSP is usually more expensive than EA in steady-state scenarios – it’s the price for agility.
• Exposure to Price Increases: In an EA, you’re shielded from Microsoft’s price hikes until renewal. In CSP, since you’re on a pay-as-you-go model, if Microsoft raises the list price of a product, your cost can increase as soon as that takes effect (unless you’ve locked an annual term for some licenses prior). For example, if Microsoft announces a 5% price increase on Microsoft 365 next year, EA customers won’t feel it until their renewal, but CSP customers will start paying 5% more when the new prices kick in. This lack of long-term price protection can make budgeting harder, and it introduces some risk if you expect significant price hikes or foreign exchange fluctuations.
• Dependent on Partner Performance: When you go CSP, you are inherently dependent on the CSP partner for support, billing, and sometimes technical guidance. A good partner can enhance your experience greatly, but a mediocre partner could be a point of frustration (delays in response, billing errors, etc.). Unlike an EA, where you work directly with Microsoft and have recourse through a Microsoft account team, in CSP, your relationship is one step removed. You’ll want to choose your CSP provider carefully to ensure they are competent and responsive. Essentially, you’re outsourcing part of your IT vendor management to a reseller, which requires trust.
• Fewer Enterprise Perks: CSP licenses give you the same software features as EA licenses (a Microsoft 365 E5 is the same product whether bought via EA or CSP). However, certain enterprise-only perks might not apply. For example, EAs often come with planning services days or training vouchers – those might not be included via CSP also, if your company values direct engagement with Microsoft (say, participating in Microsoft-led executive briefings or getting insights on the product roadmap), being on CSP might limit those interactions since Microsoft tends to focus those efforts on its largest direct customers. In short, contract terms vs EA differ: CSP is a straightforward subscription agreement and might lack some bells and whistles an EA customer gets in the relationship.
• Managing Hybrid Complexity: This is more of a consideration than a pure “con” of CSP, but if you partially adopt CSP while still having some licenses on an EA (i.e., a hybrid approach), it adds complexity. You may have to juggle two licensing models, two sets of records, and ensure you’re not over- or under-licensing across them. We’ll discuss the hybrid EA/CSP strategy shortly, but keep in mind that mixing models means extra diligence in management.

Cost Scenarios: EA vs CSP

One of the most common questions is how the costs truly stack up between an EA and CSP, and at what point does an EA become more cost-effective than CSP (or vice versa). The answer often depends on your organization’s size and usage stability.

Let’s explore a couple of scenarios to illustrate the Microsoft Enterprise Agreement pricing versus CSP pricing:

• Small to Mid-Sized Organization (e.g., 1,000 Users): Suppose you have 1,000 users who need Microsoft 365 E3 licenses. Under an EA, historically, you’d qualify for a Level A discount, which might not be very large (maybe a few percent off list price). If Microsoft’s list price for M365 E3 is around $36/user/month, an EA might bring it down slightly (for argument’s sake, ~$34/user/month after a small discount). Over a year, 1,000 users on EA might cost roughly $408,000, versus $432,000 on CSP at list price. At first glance, EA saves money here. However, consider real usage: if your workforce fluctuates and on average only 900 of those licenses are actively used in a given month, CSP would allow you to drop 100 licenses and save that money, whereas EA would have you locked into paying for all 1,000 regardless. Those avoided costs in CSP can easily outweigh the minor EA discount. In fact, many companies around this size find that CSP ends up more cost-efficient because they’re not over-buying licenses. Additionally, Microsoft sometimes won’t even offer a new EA to a 1,000-seat customer anymore, steering them to CSP or other modern agreements. The breakeven point, where EA starts to financially outperform CSP, typically occurs when usage is very stable (resulting in little to no overspend on unused licenses) and at a scale where any negotiated discount is substantial.
• Large Enterprise (e.g., 5,000 Users): At around 5,000 seats, you’re squarely in enterprise territory and could go either EA or CSP. If we assume Microsoft is moving towards flat pricing, both EA and CSP might start at similar per-user costs (maybe both around that $36 list price, unless you negotiate something special in EA). Over 5,000 users, a 5% discount in an EA could save a significant sum annually. On the other hand, if your headcount might drop by 10% at some point, CSP’s ability to scale down could save you the cost of 500 unused licenses during that period, which might be equally significant. So in this middle scenario, the cost difference between EA and CSP can be close. It really comes down to your business’s pattern: if you value the 3-year price lock and can negotiate any extra concessions (credits, fixed pricing in local currency, etc.), an EA might edge out. If you value the ability to avoid paying for any idle licenses and want to hedge against uncertain demand, CSP might be cheaper overall. Think of it as stability vs agility in cost: EA = stable costs, CSP = agile costs.
• Very Large Enterprise (15,000+ Users): For a very large organization, the scale alone historically meant an EA was almost always cheaper (thanks to big volume discounts and free extras). Now, even though Microsoft is standardizing its cloud pricing, a company this size has negotiation clout. Microsoft will be keen to keep such a customer on an EA and will often provide custom discounts or incentives (even if they don’t officially call them volume discounts anymore). For example, an organization with 20,000 seats might negotiate a special 10% off list price in their EA, or get millions in Azure credits, etc. CSP, by contrast, would charge list prices for all 20,000 users, which is a huge annual spend with no built-in discount. Unless that enterprise has a very unpredictable license need, an EA will likely be more economical for the core users at that scale. However, even large enterprises might not be static – there could be divisions being spun up or down, contractors coming in, M&A activity, etc. That’s where some portion of licenses via CSP could save money (e.g., temporary staff for 6 months – CSP could handle those more cheaply than a full EA commitment would). In pure dollars, though, a well-negotiated EA usually wins for a large steady user base. CSP would only meaningfully save money if there is a significant percentage of licenses that would have gone unused at times or if the flexibility itself yields value (like faster time-to-value on new projects).

Breakeven Consideration: There isn’t a one-size-fits-all number where EA definitively becomes cheaper than CSP, but a rule of thumb: the more stable and large your licensing needs, the more an EA’s pricing advantages shine.

The more variable or small-to-mid your needs, the more CSP’s pay-as-you-need model saves waste and approaches cost-effectiveness.

Another factor is negotiation leverage: if you’re a big customer, you might use the threat of moving to CSP as leverage to get a better EA deal from Microsoft.

Conversely, if you’re on CSP and growing, you can compare costs and consider an EA to see if Microsoft will offer discounts to win a long-term contract.

Always run the numbers for your specific scenario – sometimes the lowest cost option is a mix of both models, which brings us to the hybrid approach.

Hybrid Approach: Combining EA and CSP

Many organizations don’t strictly go “all EA” or “all CSP” – they use a hybrid EA/CSP strategy to get the best of both worlds.

This approach typically involves maintaining an EA for a portion of your licenses (usually your core, stable workforce) and using CSP for other specific needs, such as:

• Seasonal or Temporary Staff: Keep your full-time employee base covered under EA (to get volume pricing locked in), but license contractors, interns, or seasonal teams via CSP. This way, you’re not permanently licensing people who might only be around for a few months. For example, a retail company could have an EA for its corporate and year-round staff, but use CSP to license the extra 500 workers they hire over the holiday season, then remove those CSP licenses in January.
• New Ventures or Acquisitions: When your company acquires a new business or starts a new branch, you might not want to immediately fold them into your EA. Using CSP for the newly added users can be a quick stopgap to ensure they have the tools they need without renegotiating your EA mid-term. Later, at EA renewal, you could then decide whether to incorporate those users. This staged approach maintains flexibility during transitions.
• Specific Projects or Development/Test Environments: You might use CSP for certain subscriptions that are experimental or project-based, such as a batch of Power BI Pro licenses for a pilot project, or some Azure services for a development team. Those can be spun up and down in CSP without affecting your EA’s commitments.
• Different Service Needs: Sometimes organizations find value in using a CSP partner for certain services. For instance, you might have an EA for Microsoft 365 and Windows licenses, but purchase Azure through a CSP if the partner offers an optimized billing or management service for Azure that you like. There’s no rule that one organization must stick to a single agreement for everything.

How to Negotiate and Structure Hybrid: If considering a hybrid approach, you should plan out which licenses to put on the EA and which on CSP. One common strategy is to right-size your EA at renewal – i.e., commit only to the number of licenses you’re very confident you’ll use continuously for 3 years (your stable base).

Don’t add uncertain or highly variable users to the EA. Those uncertain ones can be left to CSP as a flexible buffer.

During negotiation with Microsoft, you can be transparent (or not) that you plan to use CSP for the rest; sometimes the mere fact that you have CSP as an option will encourage Microsoft to sharpen their pencil on the EA pricing because they know you have an alternative for those extra seats.

Also, be aware that running a hybrid means you need good asset management. You’ll be dealing with two channels – direct with Microsoft for the EA and with a partner for CSP. Establish processes to track license assignments so that, for example, when an employee leaves, you make sure to remove them from either EA or CSP license pools accordingly. A bit more overhead, but many find the savings and flexibility worth it.

The hybrid model is quite common in large enterprises today: use EA to get the best price on the predictable core usage, and use CSP to avoid overpaying for the variable or unpredictable usage. Microsoft is aware of this trend, and in fact, they’ve introduced programs and agreements (like shorter-term commitments and the newer Microsoft Customer Agreements) to cater to this flexibility demand. Use it to maintain negotiation leverage – having options means you’re never completely at Microsoft’s mercy on one contract.

Checklist: How to Decide Between EA and CSP

If you’re still on the fence, consider these key questions as a quick decision framework. This checklist can help align your licensing strategy with your organization’s profile:

• Is your organization 500+ users and relatively stable in size? If so, leaning towards an Enterprise Agreement makes sense to lock in pricing and potentially secure volume perks. If you’re well under 500 or expect lots of changes in headcount, CSP may be more appropriate (since EA might not even be available under 500 seats now).
• Do you prioritize flexibility over commitment? If you need the ability to scale licenses up or down frequently, then CSP’s flexibility will be valuable and likely save money by avoiding idle licenses. If your priority is predictable costs and long-term planning, the EA’s commitment (with fixed pricing) might suit you better.
• Are you prepared for a 3-year contract? An EA is a long-term marriage. If you’re not ready to commit for three years – for example, if you anticipate a major business change, or you simply want to keep options open – CSP provides a no-strings-attached approach. Organizations uncertain about the future often turn to CSP to avoid being locked in.
• Do you want direct Microsoft engagement and enterprise services? Companies that value a direct partnership with Microsoft (account managers, direct support, etc.) might prefer an EA. If you’re comfortable working with a partner for support and don’t need a lot of special attention from Microsoft, CSP works well. Your internal culture might lean one way or the other.
• Could a mix be the answer? Remember, it’s not necessarily all-or-nothing. A hybrid EA+CSP strategy can optimize costs and flexibility. If you identified some parts of your environment that are steady and others that are fluid, consider using both models to cover each part with the most suitable approach.

Use these points to evaluate your scenario. Often, the decision isn’t purely technical – it also involves finance and business strategy. In any case, being informed about both options is crucial to negotiating a better deal with Microsoft or its partners.

Comparison Table: EA vs CSP vs MPSA

To summarize the key differences, here’s a quick comparison of the Enterprise Agreement (EA), Cloud Solution Provider (CSP), and Microsoft Products & Services Agreement (MPSA) licensing models.

(The MPSA is another volume licensing option that is transactional, without a long-term contract, mainly used by some mid-to-large organizations for on-premises or mixed purchases. We include it here for completeness.)

(MPSA = Microsoft Products & Services Agreement, a flexible volume licensing deal where you accumulate points for discounts but don’t have to commit to every user or a multi-year term. Newer agreements are somewhat superseding it, but still used in some cases.)

FAQ: EA vs CSP

Q1: Is CSP always more expensive than EA?
A1: Not always, but it can be for large, steady deployments. Typically, if you have a lot of users continuously licensed, an EA’s discounts and fixed pricing make it cheaper per unit than CSP. For example, a big enterprise might pay less per Office 365 license on an EA. However, if you only need licenses part of the time or your numbers fluctuate, CSP can save money by letting you drop those licenses when not needed. In short, EA usually has a lower unit price for large stable usage, while CSP saves money if it helps you avoid paying for unused licenses.

Q2: Can I switch from an EA to CSP in the middle of the EA term?
A2: Generally, no – an EA is a contract, so you’re committed for the full 3-year term for the products you signed up for. You usually have to wait until the EA is ending to decide not to renew and then move to CSP. (In some cases, if you drastically changed your company size or something, you could renegotiate, but that’s not common.) What some organizations do is, as their EA end date approaches, they evaluate CSP as a next step or even move a portion of licenses to CSP after the EA ends. But mid-term, you can’t just break the EA without penalties.

Q3: Does CSP provide the same products and features as an EA?
A3: Yes. The licenses you get via CSP are identical in software functionality to those from an EA. A Microsoft 365 subscription is the same whether bought through a partner or through an enterprise agreement. The difference is in the contract and delivery: how you pay, how you manage the counts, and who supports you. So you won’t lose any product features by choosing CSP. It’s more about the terms (monthly vs. 3-year) and experience (partner-managed vs. Microsoft-managed) than about the software itself.

Q4: Can I negotiate pricing or discounts in CSP?
A4: You can’t negotiate directly with Microsoft for CSP pricing like you might with an EA, because Microsoft sets the base prices. However, you can shop around or negotiate with CSP partners. Partners get a small wholesale discount from Microsoft, and some might be willing to give you a better rate (by reducing their margin) or provide added services as an incentive. For instance, a partner could offer a 5% discount off Microsoft’s list price or bundle in free consulting hours. The competition among partners can give you a bit of leverage. Just manage expectations: the discounts in CSP won’t typically match the large volume discounts of an EA, but you might save a few percent or get extra value through services.

Q5: Can I use EA and CSP together for different needs?
A5: Absolutely. Many enterprises adopt a hybrid model using both EA and CSP. For example, you might keep an EA for 80% of your users (your long-term employees) and use CSP for the other 20% who are contractors, seasonal workers, or part of a new project. This can optimize costs by combining the stability of EA with the flexibility of CSP. Microsoft allows this, and in fact, it’s common to see. Just be sure to manage the two licensing pools carefully to avoid confusion. The key is to leverage each model where it fits best: EA for predictable needs, CSP for variable needs.

Q6: What happens when my EA expires?
A6: When an EA term ends, you have a few options. You can choose to renew the EA (negotiate a new 3-year term), perhaps adjusting the products or counts based on your current needs. Or you might decide to switch to CSP or another agreement if that offers more advantages now. Microsoft usually requires that you decide expiration – you can’t just extend the EA briefly (unless they grant a short grace period for negotiation). Suppose you choose not to renew an EA. In that case, you’ll want to transition those users to another licensing mechanism immediately to stay compliant (CSP is often the easiest fallback since it can be activated quickly). It’s a good practice to start planning a year before your EA ends: get quotes for CSP, talk to Microsoft about EA renewal terms, and compare. This way, you can use the expiration as a chance to optimize costs, whether that means doubling down on a new EA (with hopefully better pricing) or pivoting to the flexibility of CSP.

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