Microsoft Licensing Agreements Comparison: EA vs CSP vs MCA (and More)

Microsoft Licensing Agreements Comparison

Introduction – Navigating Microsoft’s Licensing Models

Choosing the right Microsoft licensing agreement can feel like navigating a maze. With multiple contract models – each with its own rules and acronyms – it’s easy to get confused.

Yet, licensing agreements directly impact your IT costs and flexibility, so making an informed choice is crucial. The difference between a rigid three-year commitment and a pay-as-you-go plan could mean thousands in savings or overspending.

Microsoft offers a “menu” of agreements (Enterprise Agreements, CSP, MCA, etc.), and often touts a one-size-fits-all solution. In reality, one size rarely fits all. Every organization is unique in size, cloud strategy, and budget constraints.

This guide will cut through the marketing and compare the major Microsoft licensing agreements side by side.

Our goal: to help CIOs, procurement leads, and IT managers understand how EA, CSP, MCA, MPSA, and other options differ – so you can pick the model that best fits your needs.

Overview of Microsoft Licensing Agreements

At a high level, Microsoft has several primary licensing contracts.

Here’s a quick overview of the major agreements and who they’re designed for:

• Enterprise Agreement (EA): A classic 3-year contract for organizations with 500+ users or devices. It requires enterprise-wide licensing of core products. Best suited for large enterprises standardizing on Microsoft across the board – offers big volume discounts but demands a firm commitment.
• Microsoft Customer Agreement (MCA): A modern “evergreen” agreement (no fixed end date) that is cloud-centric and digital-first. It’s a straightforward pay-as-you-go contract for Microsoft services (like Azure and Microsoft 365) with no minimum purchase. Geared toward flexibility and direct purchasing, especially for mid-sized customers moving to the cloud.
• Cloud Solution Provider (CSP): A program where you buy Microsoft subscriptions through a third-party provider (partner). Offers monthly or annual subscriptions with the help of a partner managing your account. Ideal for organizations that want flexibility to scale up/down and prefer a partner’s support in managing licenses.
• Microsoft Products & Services Agreement (MPSA): A transactional volume licensing agreement for buying software licenses and cloud services à la carte. No long-term contract – you purchase as needed. Good for organizations (often mid-sized) that need on-premises licenses or miscellaneous Microsoft products without an enterprise-wide commitment. MPSA is gradually being phased out as Microsoft shifts focus to cloud subscriptions.
• Open Value & Other Small-Business Options: Microsoft also offers Open Value agreements (and Open Value Subscription) for smaller businesses. These are simplified 3-year contracts tailored for SMBs, often providing volume pricing and Software Assurance benefits on a small scale. They serve as “mini-EAs” for companies too small for an Enterprise Agreement. (Microsoft’s old Open License program for one-off purchases has been retired, with CSP now filling that role for small purchases.)

With that high-level picture in mind, let’s dive deeper into each major agreement type and what it means for your organization.

Deep Dive – Key Agreements Explained

Enterprise Agreement (EA)

The Enterprise Agreement is Microsoft’s flagship licensing program for large organizations.

It’s a three-year contract covering all users or devices across the enterprise for selected products (like Windows, Office/Microsoft 365, and others).

Companies signing an EA agree to license Microsoft software for “enterprise-wide” use, meaning you include everyone (or everything) that meets Microsoft’s criteria as a user or device.

Features: An EA has a 3-year term and typically requires at least 500 “seats” (users or devices), although Microsoft now often targets 2,400+ seats for new EAs. It includes Software Assurance (SA) on all licenses, providing upgrade rights and other benefits throughout the term.

You lock in pricing for three years. Each year, you report any increases in usage (new employees or devices added) and pay a True-Up for those additions. However, reducing licenses (a “true-down”) isn’t allowed until the end of the term in most cases.

Strengths: The EA shines in volume discounts and price protection. Large enterprises get the best per-user pricing through tiered discounts – and those prices are fixed for the duration of the agreement, shielding you from Microsoft’s annual price hikes. The predictable annual spend simplifies budgeting.

EAs also allow custom negotiation: you can often negotiate special terms or concessions if you’re a big customer (e.g., added support hours, specific legal protections, or unique product terms).

Additionally, the inclusion of Software Assurance means you have access to upgrades, training vouchers, and hybrid use benefits for cloud, which is great for organizations running both cloud and on-premises setups.

Weaknesses: The obvious drawback is the lack of flexibility. You’re locked into a commitment for three years. If your organization shrinks or you want to drop a product, you generally can’t reduce your licensing counts until the EA is up for renewal. This can lead to wasted spend on “shelfware” (unused licenses).

The upfront enterprise-wide scope can also be overkill for companies that don’t need every user on the same bundle of Microsoft products.

Furthermore, Microsoft has been tightening eligibility – if you’re under a certain size (e.g., under ~2,400 users), Microsoft might push you toward other agreements at renewal.

In short, an EA is powerful for stability and discounts, but you sacrifice agility and must be confident in your 3-year roadmap.

Microsoft Customer Agreement (MCA)

The Microsoft Customer Agreement is a newer contracting approach that is digital, streamlined, and evergreen.

Unlike an EA, the MCA isn’t a fixed-term contract – it’s an open-ended agreement you accept (usually via an online portal) to buy Microsoft cloud services on an ongoing basis. Think of it as Microsoft’s modern answer for cloud-era purchasing.

Features: The MCA is cloud-focused and was initially introduced for Azure subscriptions, though it’s expanding to cover Microsoft 365 and other services. There’s no minimum user/device requirement – organizations of any size can use an MCA.

You sign the Microsoft Customer Agreement once (a simplified document) and thereafter can add or remove subscriptions as needed. All management is done through Microsoft’s self-service portals.

You can choose monthly billing or annual prepaid subscriptions for services, similar to CSP. The agreement never expires; it continues until you decide to stop purchasing services.

Strengths: The biggest advantage is flexibility. With an MCA, you’re essentially on a pay-as-you-go model. Need to ramp up Azure resources for a project this quarter? Just do it – no contract amendment needed. Need to drop 50 Microsoft 365 licenses next month? You can, as long as you choose a monthly term or your annual term is ending.

The agility is high, making it great for cloud-first organizations or those with fluctuating needs. It’s also simple and fast to set up – no drawn-out negotiations or complex paperwork, since the terms are standard.

For companies that prefer a direct relationship with Microsoft (instead of going through a reseller), MCA provides that direct line for purchasing and billing. This can streamline communications if you’re comfortable managing your own licensing through Microsoft’s portal.

Weaknesses:

In exchange for flexibility, you give up the traditional volume discounting and price locks. Under an MCA, pricing is generally at Microsoft’s normal list prices (you pay the catalog rate like any other customer unless you have a special deal).

Large enterprises no longer automatically get better pricing just because of size – you’d have to negotiate a separate discount or incentive (for example, committing to a certain Azure spend might get you a percentage off, but that’s a one-off negotiation, not a built-in feature of the program).

Also, unlike an EA, an MCA doesn’t include Software Assurance by default and doesn’t easily cover perpetual on-premises licenses – it’s really designed for cloud subscriptions.

If you still rely on on-prem servers with upgrade rights, MCA alone won’t cover those needs (you might maintain a separate legacy agreement for that). Lastly, management and support under MCA are more DIY.

You won’t have a Microsoft licensing partner handling procurement or a dedicated support wrapped in; you’ll be managing subscriptions in-house and contacting Microsoft support (or a paid support plan) when issues arise.

For some, that direct control is fine; for others, it means you need sufficient internal expertise to avoid mistakes (like inadvertently over-provisioning, since there’s no “true-up” event to true-up or true-down – it’s on you to manage usage continuously).

Cloud Solution Provider (CSP)

The Cloud Solution Provider program is Microsoft’s partner-driven model for subscription licensing. Under CSP, you don’t sign a big contract with Microsoft.

Instead, you buy your licenses (especially cloud subscriptions like Microsoft 365, Dynamics 365, Azure, etc.) through an authorized Microsoft partner – often an IT services company or reseller who operates a CSP business.

This partner handles your billing and support, essentially acting as your licensing concierge.

Features:

CSP is very flexible in terms of subscription options. You can typically go month-to-month or commit to 1-year or 3-year subscriptions for better rates. There is no overall term or volume requirement for CSP; it’s open to any size (from a 5-person startup to a large enterprise department).

The partner provides an admin portal or integrates with Microsoft’s portal for you to manage subscriptions. CSP encompasses almost all cloud services (Microsoft 365, Azure plans, etc.), and even offers some perpetual software licenses for one-time purchase (though not every product is available that way).

It’s part of Microsoft’s “New Commerce Experience,” which standardized many CSP offerings to align with how direct subscriptions work.

Strengths: The key benefit is agility with a helping hand. Through CSP, you get similar flexibility to MCA (ability to add or remove licenses on your renewal cycles, and even month-to-month adjustments if you choose monthly terms) but with the added support of a partner.

Good CSP partners will handle a lot of the heavy lifting: they’ll help provision licenses, advise on the right plans, provide support if users have issues, and consolidate your billing.

This is great for organizations without a dedicated licensing specialist – essentially, the partner is an extension of your team. CSP is also very scalable for seasonal or variable needs: you could, for example, increase licenses for a short-term project and then reduce them, only paying pro-rated amounts.

Another plus is cash flow: CSP often bills monthly, so you’re not paying a huge upfront sum – it converts more of your spend to operational expense (OpEx) aligned with usage.

Finally, CSP can be an easier entry point for new Microsoft services. If Microsoft launches a new cloud product, CSP partners can sell it to you immediately without waiting for an EA renewal – you can experiment with new tech more freely.

Weaknesses: The flip side is potentially higher costs per unit and reliance on the partner. CSP pricing is generally based on Microsoft’s standard rates. While partners can offer you a discount from their margin (and some do to win business), you typically won’t achieve the deep volume discounts that a large EA might get.

Additionally, Microsoft now enforces premiums for flexibility – for instance, month-to-month subscriptions in CSP cost around 20% more than annual ones. So if you do stick with always-monthly to maximize flexibility, you pay a premium for that privilege. Over a multi-year span, if you keep licenses continuously, CSP could cost more in total than an EA would have for the same static number of users.

Also, Software Assurance is not included in CSP subscriptions (cloud subscriptions inherently include updates, but if you need hybrid usage rights or to cover on-premise software, CSP licenses alone might not suffice). Some on-premises licenses can be bought via CSP, but they come without SA and with limited upgrade rights, which might not fit all scenarios.

Finally, you are dependent on the partner’s quality. A bad or inattentive CSP provider can be a pain – e.g., slow response to issues or complicated cancellation policies. Switching CSP partners is possible, but can be a hassle.

Therefore, your experience in CSP is only as good as your chosen partner. For many small and mid-sized businesses, though, the trade-off is worth it for the flexibility and support.

Microsoft Products & Services Agreement (MPSA)

The MPSA is a volume licensing contract that Microsoft introduced to streamline transactional purchases.

Think of it as a “no-strings” volume agreement: you sign an MPSA once, and then you can buy licenses (perpetual software, cloud subscriptions, Azure credits, etc.) as needed, without committing to organization-wide coverage or long terms.

Features: MPSA is open-ended (no fixed term) and works on a point-based system for volume discounts. Various purchases (Office licenses, server licenses, etc.) contribute points toward discount levels – the more you buy, the better pricing tier you achieve for future purchases.

Unlike EA, you are not automatically licensing every user/device; you just purchase whatever licenses you want, when you want. Software Assurance is optional under MPSA – you can choose to add SA to a license purchase (to get upgrade rights, support benefits, etc.) or you can buy licenses without SA.

The agreement consolidates all your Microsoft purchases under one contract ID, which can simplify management compared to juggling separate one-off purchase orders or legacy agreements like Select Plus (which MPSA effectively replaced).

Notably, there’s no annual true-up ritual – because you’re not on a fixed subscription count; you simply order new licenses when needed.

Strengths: The MPSA offers flexibility in purchasing. You’re not locked into a set number of licenses or a term – if you need something, you order it, and if you don’t need anything this year, you buy nothing (no penalty).

It’s great for organizations that have variable or unpredictable needs for certain Microsoft products, or that are in a transition phase (for example, slowly moving to the cloud: you might not want an EA, but still need to buy a few server licenses or Office copies this year). Volume discounts do exist via the points system, so loyal usage of MPSA can still yield cost savings at scale, especially for software purchases.

The agreement is also simpler to manage than an EA in some ways: fewer contractual obligations and the ability to self-serve purchases through Microsoft’s business center portal.

MPSA can cover a mix of on-prem and cloud, giving a one-stop agreement for all types of purchases (though the cloud subscriptions available through MPSA are more limited now that CSP/MCA are the favored routes).

Weaknesses: MPSA’s relevance is fading as Microsoft emphasizes subscriptions. Many new cloud features or bundles might not be offered under MPSA, or if they are, they could be less attractively priced compared to CSP/MCA deals.

Discounts under MPSA, while present, usually aren’t as steep as EA for very large deployments – an EA still typically beats MPSA on price for a big enterprise licensing the whole company.

Also, MPSA doesn’t inherently include a dedicated partner’s guidance or support (though you’ll likely purchase through a licensing reseller). It’s more of a transactional relationship, so you’ll want to have licensing knowledge in-house to ensure you’re buying the right stuff and staying compliant.

Microsoft has indicated that MPSA is a “sunset” program in the long run (it already replaced Select Plus, and could itself be replaced by newer models).

If you adopt MPSA, be mindful that down the road, you may be steered toward CSP or MCA for certain purchases anyway.

In summary, MPSA is a useful stopgap for specific needs – especially on-premises license procurement – but not a forward-looking solution for a cloud-driven world.

Other Licensing Programs

Beyond the big four above, Microsoft maintains a few specialized and small-business licensing programs.

These are niche options, but worth knowing briefly:

• Open Value / Open Value Subscription: Designed for small to midsize businesses (generally those with fewer than 250 PCs), Open Value is akin to a mini-EA. It’s a 3-year agreement that can cover your whole organization (or specific departments). It often appeals to SMBs who want to standardize on Microsoft software and enjoy some perks like Software Assurance without the scale of an EA. Open Value Subscription is a variant where you essentially “rent” licenses for three years instead of owning them perpetually, with the ability to adjust counts annually. These programs can offer better pricing for small customers than purchasing retail, and include upgrade rights; however, they still require a time commitment and an approved Microsoft reseller to set up. Notably, Microsoft has retired the older Open License program (which was one-time purchasing for small orgs). These days, many smaller companies simply use CSP for flexibility, but Open Value still exists if an SMB prefers a fixed 3-year approach with SA benefits.
• Select Plus (retired): This was a predecessor to MPSA for midsize and large orgs to buy licenses without an EA. It’s mentionable only historically – new Select Plus agreements aren’t offered, as MPSA took its place.
• SPLA (Service Provider License Agreement): Not directly relevant to end-customers, this is a program for service providers/hosters. If your company delivers software services to third parties (for example, you host applications for clients), SPLA is how you license Microsoft products every month for that scenario. It’s mentioned here just to distinguish it: SPLA is for hosting providers, whereas most normal organizations will use one of the other agreements for internal use licenses.

In general, if you’re a typical commercial organization, the EA, CSP, MCA, or MPSA will cover 95% of scenarios, with Open Value being an option if you’re on the smaller side. Now, let’s compare these agreements directly on key decision criteria.

Comparison by Criteria

Commitment Length

One of the biggest differences is how long you’re tied into each arrangement.

The Enterprise Agreement locks you into a 3-year commitment. During that term, you’re expected to maintain at least your initial quantity of licenses, and you’re financially committed for the full period (usually paying annually).

In contrast, Cloud Solution Provider (CSP) and Microsoft Customer Agreement (MCA) are far more flexible – they have no fixed overall term. You can start or stop subscriptions as needed. CSP lets you choose subscription lengths on a per-product basis (month-to-month or yearly, for example).

MCA is open-ended: you’re essentially on a month-to-month arrangement for services unless you opt into an annual prepaid plan for a discount, but there’s no 3-year master contract holding you down.

MPSA similarly has no term requirement – the agreement remains in place indefinitely, but you aren’t obligated to keep purchasing. You just buy what you need when you need it.

In summary, if you want the shortest commitment, CSP or MCA provides month-to-month freedom, whereas an EA is a long-haul contract. MPSA sits in the middle as an ongoing agreement, but without subscription obligations.

Discount Potential

How much can you save under each model? For large deployments, EA traditionally offers the deepest discounts. Microsoft rewards big customers: an Enterprise Agreement has built-in volume pricing levels (A, B, C, D tiers, etc.), so the more users you license, the lower the price per license.

Additionally, with an EA, you avoid the 20% premium that CSP monthly plans carry, and your pricing is locked to prevent increases for 3 years. This can yield significant savings for organizations with thousands of seats.

Under CSP, pricing is typically based on Microsoft’s retail rates. A CSP partner might give you a slight discount from their margin (especially if you negotiate or bring significant business to them), but you shouldn’t expect huge percentage cuts like an EA Level D discount.

CSP is more about flexibility than rock-bottom unit price. Also, as noted, if you opt for monthly term subscriptions in CSP, you’ll pay about 20% more than the base annual rate – effectively a flexibility tax.

MCA pricing is similar to CSP in that it’s largely at list price for software and services. Microsoft doesn’t automatically tier pricing for MCA customers by size – a 50-user company and a 5,000-user company theoretically pay the same catalog price under MCA.

That said, if you are a larger customer, you can often negotiate ad-hoc discounts or credits with Microsoft under an MCA (for example, Microsoft might offer a discount if you commit to spend a certain amount on Azure over the year).

Those are bespoke deals, not an inherent feature of the pricing model. Importantly, MCA does not include any long-term price protection – if Microsoft’s cloud list prices go up next year, they will go up for you too.

MPSA provides volume discounts differently. It uses a point system: each license purchase contributes points, and hitting certain point totals gives you a better price level for future orders.

So, you can achieve a discount off the list if you’re buying a lot through MPSA. However, the discounts generally top out lower than EA’s.

For instance, an EA might give a very large org 15-20% off list on a broad range, whereas an MPSA might yield smaller percentage savings unless you continuously buy in high volume.

MPSA also doesn’t lock prices long-term; pricing can adjust with Microsoft’s price lists, though once you’ve bought something, that purchase is at a fixed price.

In short, EA is king for maximum discounts (especially for enterprises with thousands of seats), while CSP and MCA focus on flexibility at basically standard pricing.

MPSA sits somewhere in between – some discounts, but not as rich as EA, and more relevant for one-time buys than ongoing cloud subscriptions.

Flexibility

When it comes to adjusting your licensing to your needs, the agreements differ wildly. Enterprise Agreement is the least flexible: you commit upfront to an organization-wide baseline. If you need more licenses, you can always add them (and pay at the next True-Up date), but if you need fewer, you typically have to wait until the end of the 3-year term to reduce your count.

Microsoft does allow a bit of wiggle room at anniversaries for certain online services, but generally, you’re locked in. This can be painful if you have layoffs, divest a business unit, or want to swap out a Microsoft product for a competitor – you keep paying for the EA regardless.

CSP is highly flexible. If you choose monthly subscription terms, you can increase or decrease licenses every month with no long commitment. Even on annual terms in CSP, you have the option not to renew a license at the next annual renewal, effectively adjusting once a year.

This means you can react to changes in staff count or project needs relatively quickly. Spinning up 100 temporary users for a project for 3 months is easy under CSP (and you’d only pay for those 3 months). Cancelling or reducing licenses is also straightforward at the next renewal point.

MCA offers similar flexibility to CSP. Because the Microsoft Customer Agreement isn’t binding you to a number, you simply control what subscriptions you have active in the portal. If you no longer need a service, you can turn it off (observing whatever billing cycle you committed to – e.g., end of the month for monthly services, or end of the year if you prepaid annually). There’s no penalty for stopping services beyond paying for the current period. So, MCA lets you scale up and down in close to real-time with business needs.

MPSA provides flexibility in a different sense – since it’s transactional, you’re never obligated to buy more. You purchase licenses when required. If your needs shrink, you just stop buying new licenses (though note: if you own perpetual licenses via MPSA, you can’t exactly “give them back,” but you also aren’t paying for them ongoing aside from optional SA). MPSA doesn’t force a company-wide coverage or a renewal cycle.

However, it’s not a subscription you adjust; it’s individual purchases. So the flexibility is mainly in not having to forecast and commit ahead – you have the freedom to procure on demand. For organizations uncertain about future needs, that lack of commitment is a form of flexibility.

Bottom line: CSP and MCA are best for on-the-fly flexibility, EA is the most rigid (designed for consistent environments), and MPSA is flexible in purchasing timing but not meant for continuous up-and-down license count changes on subscriptions.

Management & Relationship

The nature of your relationship with Microsoft (and/or a partner) is another key differentiator.

With an Enterprise Agreement, you typically interact with Microsoft (often through an authorized LSP – Licensing Solution Provider – who handles the paperwork and ordering).

You will likely have a Microsoft account manager or rep because of your size. However, day-to-day license management is largely on your IT/procurement team (or whichever partner you work with for support).

Support is not included automatically in an EA; many EA customers also purchase a Microsoft Unified/Premier Support plan or work with their LSP or another consultant for help.

The EA gives you a direct contractual relationship with Microsoft, which can be useful if you need to escalate issues or negotiate custom terms. Still, it also means you have to handle compliance and asset management diligently on your side.

Under CSP, your primary relationship is with the partner (reseller). The CSP partner bills you, often giving you a single invoice for all your Microsoft subscriptions (and maybe any services they provide on top).

They also serve as your first line of support – if a user can’t activate Office or you have a service issue, you typically call your partner, not Microsoft. The partner, in turn, can escalate to Microsoft if it’s a deeper problem.

Microsoft still defines the product terms, but your legal agreement for services is the Microsoft Customer Agreement (yes, even CSP customers accept a Microsoft Customer Agreement in the background) plus whatever agreement you have with the partner for their services. For management, many CSP partners provide tools or a portal to make changes, or they’ll do it for you.

This outsourced management can be a relief for small IT teams. On the flip side, you need to trust that partner – you’re somewhat tied to their quality of service. If you outgrow them or are unhappy, you might have to switch CSP providers down the line.

With an MCA (Microsoft Customer Agreement directly), your relationship is directly with Microsoft and largely self-service. You don’t necessarily get a dedicated account manager unless you’re a very large account, since MCA is meant to be a streamlined online purchase experience.

You use Microsoft’s admin portals (like the Microsoft 365 Admin Center, Azure Portal, etc.) to manage users, subscriptions, and billing. Microsoft will send you invoices directly. If you need help or want to buy something, you’re doing it in the portal or calling Microsoft sales.

This gives you more control and transparency, but means you need to have the expertise in-house to administrate your licenses and optimize costs. Some organizations prefer to have that control and not rely on a third party.

Others might miss the advisory role a good partner can play. Support under MCA is what you make it: you can use standard support channels or purchase a support plan, but there’s no partner automatically helping you day-to-day.

The MPSA is somewhat in between EA and MCA in relational terms. It’s a direct agreement with Microsoft, but typically you’ll work with a Volume Licensing reseller to place orders (especially for software). You manage your licenses through Microsoft’s Business Center (for MPSA), which is a self-service portal.

You won’t have a cloud portal in the same way for MPSA because it’s more about purchases than managing active subscriptions (Azure under MPSA, for example, would be managed in the Azure portal but purchased via MPSA billing).

The relationship is transactional; you might not have a dedicated Microsoft rep unless your volume is very high, and you don’t have a CSP partner by definition (though your reseller can offer advice, they aren’t on the hook to manage your usage like a CSP partner would be).

In summary, EA and MCA put more responsibility on the customer’s shoulders (with EA you do get a formal sales relationship at least). CSP hands a lot of that responsibility to a partner (which can be good or bad depending on the partner’s skill).

MPSA is a do-it-yourself model as well, though you’ll interact with a licensing provider to an extent.

Consider your internal resources: if you lack licensing expertise or bandwidth, a CSP arrangement might serve you better; if you have a capable IT asset management team, a direct EA or MCA gives you control and negotiating power.

Best Fit by Scenario

Each agreement has a “sweet spot” where it tends to be the best choice.

Here’s a breakdown of which scenarios or organization types align well with each Microsoft licensing model:

• Enterprise Agreement (EA) – Best for large, stable enterprises: If you have a large user count (generally 500+, and especially in the thousands) and plan to use Microsoft’s products broadly, an EA is often the most cost-effective. It’s ideal when you want to standardize IT across the entire company with Microsoft’s suite (Windows, Office 365, EMS, etc.) and you value predictable costs. Also, if you maintain a lot of on-premises software alongside cloud services, the EA covers that hybrid mix elegantly. Enterprises that can forecast their needs and don’t expect to downsize significantly find the EA beneficial. Think Fortune 1000 companies, global firms, or any organization where Microsoft technology is ubiquitous and long-term stability is key.
• Cloud Solution Provider (CSP) – Best for SMBs, smaller deployments, or variable needs: CSP is a great fit for small-to-medium businesses that want the flexibility of cloud subscriptions without committing to volume contracts. It’s also useful for larger companies in specific cases – for example, a subsidiary or department that isn’t part of the main EA might use CSP; or a company with highly variable license needs (seasonal workers, project-based contractors) can leverage CSP to scale up and down. If your organization lacks a large IT procurement department, the partner support in CSP can be a lifesaver. It’s very much suited to those who value agility and service over locking in a low unit price. Startups and mid-market companies often begin with CSP to keep things simple.
• Microsoft Customer Agreement (MCA) – Best for cloud-first mid-market organizations (and some large ones): MCA is emerging as the go-to for mid-sized customers who are primarily consuming cloud services. If you have, say, a few hundred to a couple thousand users, and you’re focused on Azure and Microsoft 365 with minimal on-prem dependency, an MCA gives you flexibility and direct control. It can also appeal to larger enterprises that are transitioning away from the traditional EA model, especially if Microsoft is no longer offering them an EA (as is happening with some customers <2400 seats). A large enterprise might also choose the MCA for specific purposes, such as handling Azure consumption under a more flexible deal while still maintaining an EA for other licenses. Although Microsoft would likely try to consolidate, some customers do run both. Choose MCA if you’re comfortable managing licenses in-house and want to avoid long commitments, but still need an enterprise-grade agreement directly with Microsoft.
• Microsoft Products & Services Agreement (MPSA) – Best for legacy on-premises purchasing or mixed needs: If your organization still heavily relies on purchasing perpetual licenses (e.g., Windows Server, SQL Server, Visual Studio, or Office licenses to own) and you either don’t qualify for an EA or don’t want one, MPSA is a fit. It’s often used by mid-sized companies (or large ones for specific purchases) that need to buy software without committing to covering everyone. It’s also useful if you are in a gradual cloud migration. For instance, you might use MPSA to renew Software Assurance on some server licenses or buy some extra Visio/Project licenses, while handling new cloud subscriptions via CSP. Companies that previously used the old Select Plus program have mostly transitioned to MPSA. It’s the best fit when flexibility in purchasing on-prem and a moderate volume discount matter, but a full EA is not on the table.
• Open Value and small business programs – Best for very small organizations or special cases: If you’re an SMB with, say, 20, 50, or 100 employees, and you prefer owning licenses or need Software Assurance on desktop products, an Open Value agreement can be attractive. It’s also often used in government or education for smaller entities through variants of Open agreements. Open Value Subscription might be chosen by a nonprofit or a small school district that wants to pay annually for three years and have the latest software for a set of PCs. These programs are niche and not growing (most new small customers now opt for CSP), but they still exist to serve cases where a little more structure and discount than retail is desired, without scaling up to enterprise levels.

Now that we’ve identified the best fit for each model, let’s discuss how organizations transition between these agreements and what to consider during migrations.

Migration and Transitions

The Microsoft licensing landscape isn’t static – many organizations find themselves moving from one agreement type to another as they grow, shrink, or shift strategy (often influenced by Microsoft’s own changes).

EA Renewals vs. Shifting to CSP/MCA: If you’ve been on an Enterprise Agreement, a big question comes at renewal: renew for another 3 years or switch to a more flexible model? Microsoft has been encouraging mid-sized customers (especially those with 500–2,400 seats) to transition from EAs to CSP or MCA. This could be presented as a cost-saving opportunity or simply, “we’re not offering an EA renewal.” If you’re in this boat, assess the trade-offs carefully.

An EA renewal might give you price stability and continuity of SA benefits, but maybe your user count or cloud adoption no longer justifies it. Moving to CSP or MCA could save money if you have excess licenses you’d like to shed, or if you expect better deals on Azure via direct consumption.

However, be prepared for changes: for example, under an EA, you might be used to a true-up at year’s end and true-downs not being allowed; under MCA/CSP, you’ll need to manage adds and removals continuously (and watch out for that 20% monthly premium if you opt for maximum flexibility).

Plan the timing – some organizations do a phased transition, where they renew the EA for on-prem licenses one last time, but move cloud workloads to CSP right after renewal to test the waters.

Dropping MPSA for Cloud Subscriptions:

As cloud services take center stage, the need for MPSA tends to dwindle. You might have used MPSA to buy Office or Windows licenses, but no, if you’re subscribing to Microsoft 365 through CSP or MCA, you won’t need those old licenses.

Organizations in this transition often maintain MPSA only for a few legacy pieces (such as a couple of server products that still run on-premises), but direct all new purchases to CSP/MCA.

If your MPSA isn’t giving you much benefit anymore, consider consolidating to simplify life. Microsoft Customer Agreement (for direct) or CSP (through a partner) can likely cover all your new needs, and you can let MPSA idle or terminate it if it’s truly no longer used.

Keep in mind any Software Assurance on MPSA – if you drop MPSA, you might lose upgrade rights unless you’ve transitioned those licenses to subscription equivalents.

Hybrid Approach – Combining Agreements: Some large enterprises use a mix of agreements to maximize benefits. For example, you might keep an EA for core enterprise-wide services (to get the best discount on, say, Microsoft 365 E5 for all full-time staff), but use CSP for a branch of the business that’s newly acquired or for a development/test environment that needs short-term Azure subscriptions outside the EA commitment. Or perhaps you sign an MCA for Azure because you negotiated a great consumption deal with Microsoft directly, but you keep Office 365 under an EA.

Hybrid licensing approaches can work, but they require careful management so you don’t double-pay or run afoul of contract terms.

One common mistake is when departments outside of IT independently buy CSP subscriptions while the company has an EA – this can lead to paying twice for the same product if not coordinated (and can violate the EA’s requirement to cover all users for certain products).

To avoid this, have a clear internal policy and tracking of what goes in which agreement. Hybrid models should be a strategic choice, not an accidental patchwork.

In any transition, also pay attention to true-up timing and end dates. If moving off an EA, ideally, do it at the EA’s end to avoid paying for redundancy. If you must switch mid-term (e.g., Microsoft won’t let you renew an EA), negotiate exit terms or ensure new purchases under CSP/MCA align with the ramp-down of the EA.

Data migration for services (like moving from one Azure enrollment to another under MCA, or from EA Office 365 tenant to CSP tenant) usually isn’t an issue since the services are the same – it’s more about transferring billing arrangements, but double-check with Microsoft or your partner on how to handle a smooth switchover.

Lastly, evaluate your Software Assurance benefits during transitions. If you have training days, support vouchers, or rights like Double Usage (which come with SA), make sure you either use them before changing contracts or have an alternative plan to replace those benefits (like purchasing a support plan separately or ensuring your new subscriptions include similar capabilities).

Migrating licensing agreements is a project in itself – but done right, it can optimize your costs and align with your current IT strategy. Don’t be afraid to ask Microsoft or a licensing consultant for a preview of what a switch entails.

The key is to avoid being caught off guard by any unexpected issues (such as billing overlaps, lost benefits, or compliance gaps) during the transition.

Related articles

• Microsoft EA vs. Microsoft Customer Agreement (MCA): Which Is Right for You?
• Microsoft EA vs. CSP: Should You Stay with an EA or Use Cloud Solution Providers?
• Microsoft EA vs. MPSA: Enterprise Agreement or Pay-as-You-Go Volume Licensing?
• Which Microsoft Licensing Agreement to Choose? A Decision Guide

Five Expert Recommendations

To wrap up, here are five expert tips for decision-makers when comparing and choosing between EA, CSP, MCA, and other Microsoft agreements:

1. Start with a thorough self-audit of usage and needs. Before you even pick a licensing model, know what you have. Inventory your current Microsoft licenses and cloud services, and identify your usage patterns. Are you using 100% of what you’re paying for, or do you have shelfware? How much of your infrastructure is moving to Azure or SaaS vs staying on-prem? This data-driven approach will clarify which agreement fits best. For instance, an audit might reveal that only 70% of your EA licenses are actively used – a sign to possibly downsize or switch models.
2. If you’re large enough for an EA, negotiate hard (and consider caps). Enterprise Agreements can still be incredibly valuable for big organizations, but make sure you negotiate buyer-friendly terms. Don’t accept Microsoft’s first quote. Push for extras like price caps on additional licenses, the ability to true-down certain services at anniversaries, or flat renewal pricing in three years. Also, negotiate any needed contractual terms (security, privacy, etc.) while you have leverage. Essentially, if you commit to an EA, get as much value and flexibility in writing as you can – you won’t be able to change it for 3 years after signing.
3. Cloud-first organizations should weigh CSP vs. MCA based on support needs. If you’re going all-in on Azure and Microsoft 365 and not looking back to on-prem, both CSP and MCA could work. Choose based on how much help you need. Do you have a solid internal team that can manage licenses, optimize Azure spend, and handle support tickets? If yes, an MCA (direct with Microsoft) might save you the partner’s cut and give you simplicity. If not, a CSP partner’s managed services could be worth their margin. Also factor in any pricing differences a partner offers and the quality of that partner. It can be worth interviewing multiple CSP providers – their services and discounts can vary.
4. For SMBs, CSP is usually the go-to for agility and simplicity. If you’re a smaller business, the CSP model likely will serve you best. It requires no upfront investment, you can adjust month to month, and you get the benefit of an IT partner who can advise you. While Open Value agreements are an option, they make sense mainly if you absolutely want a 3-year lock and ownership of licenses – a scenario that’s less common now with cloud subscriptions. The vast majority of small and mid-size businesses find CSP’s flexibility (and lack of bureaucratic complexity) a better match. Just be sure to select a CSP partner known for good support, because you’ll lean on them heavily.
5. Always benchmark your options before committing. This might be the most important tip: do your homework. Before signing anything, compare the total 3-year (or 5-year) cost of an EA vs. CSP vs. MCA for your organization. Get quotes if possible. Engage a licensing expert or use Microsoft’s pricing calculators. Sometimes, Microsoft will do an “EA vs CSP” cost analysis for you if you ask. Also, consider intangibles like: What’s the cost of flexibility worth to you? How do support and administrative overhead factor in? By evaluating side-by-side, you might discover, for example, that CSP could cost 10% more than an EA for your steady-state users, but you’re willing to pay that for the ability to reduce licenses if needed. Or you might find that sticking with an EA actually saves a lot of money, even though Microsoft is nudging you to the new shiny agreement. Don’t be rushed by a sales cycle – take the time to benchmark and plan. The licensing decision is significant for your IT budget and shouldn’t be made on a whim.

In conclusion, Microsoft’s licensing options each have their place.

The Enterprise Agreement is no longer the automatic choice for everyone as it once was – alternatives like CSP and MCA offer newfound freedom that can greatly benefit certain organizations.

By understanding the differences and aligning them with your strategy, you can strike the right balance between cost savings and flexibility.

Always remember: the best agreement is the one that fits your business needs, not just Microsoft’s sales goals.

With due diligence and perhaps a healthy dose of skepticism toward any one-size-fits-all claims, you’ll be well on your way to a smart Microsoft licensing strategy.

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