There have been some recent changes to Microsoft incentives for indirect CSP ressellers that all CSP program participants should pay attention to. These changes include the addition of a revenue threshold for Microsoft’s incentive program, and a new accelerator for non-profit organizations.
Changes to Microsoft incentives: Addition of revenue threshold
Microsoft added a revenue threshold that indirect resellers must meet to enroll and stay enrolled in the incentive program. This threshold is a trailing 12-month (TTM) revenue of $25K USD, looks back over the last 365 days and will be assessed weekly. The $25K USD TTM revenue threshold and MPN and competency requirements must be met to be invited to enroll in the incentive program from Oct. 1, 2021, onward.
There’s a bit of nuance to understand here for brand new resellers. Microsoft partners invited to enroll in the CSP Indirect Reseller incentive program prior to Oct. 1, that do not meet the $25K threshold, will be offboarded for not meeting requirements. However, if a partner had already met the threshold, was invited to enroll in the incentive program, and then falls below the $25K TTM after joining the program, they will not be offboarded.
New accelerator for nonprofits
Good news! There’s a new way for you to be rewarded. The nonprofit sector is the fastest growing industry inside Microsoft, and you can now be rewarded for selling to qualified nonprofit entities. The Nonprofit (TSI) Product Accelerator is 12% and calculated based on billed revenue from specified Modern Work & Security products. Earnings are split between 60% rebate payment and 40% co-op accrual.
Recap of Microsoft CSP Indirect Reseller Incentives for FY22
You are probably already familiar with the indirect incentives for FY22, but if you need a refresher, read on!
Term Oct 1, 2021 – Sept 30, 2022
The Microsoft CSP Indirect Reseller incentive program rewards partners for driving Cloud Solution Provider (CSP) revenue, adding customers and selling strategic products. The term for these incentives runs from October 1, 2021 to September 30, 2022.
Partners must meet the following criteria to be eligible to receive incentives through this program:
Partner Agreement: Microsoft Partner Network Agreement
Partner Authorization: Microsoft CSP Indirect Reseller Channel Authorization
Program Enrollment: Cloud Solution Provider Indirect Reseller
Competency or Certification: Active competency in one of the following: Cloud Business Applications, Cloud Platform, Cloud Productivity, Data Analytics, Data Platform, Enterprise Mobility Management, Enterprise Resource Planning, Small and Midmarket Cloud Solutions, Windows and Devices
Membership level: Silver or Gold
Revenue Requirements: $25K USD 12-month revenue threshold
This group of incentives is awarded based on billed revenue and will be paid out 60% as a rebate and 40% as co-op to put towards activities that drive more Microsoft business. Learn more about co-op funds in our previous blog post here.
- Azure billed revenue, 4%
- Remember that Azure will be moving out of the CSP program beginning February 1, 2022. You can find detailed information about this change in our previous blog post here.
- Modern Work & Security billed revenue, 4%
- Business Applications billed revenue, 4.75%
Strategic Accelerator payments are calculated as a percentage of revenue transacted for specified products. These incentives are applied in addition to the global incentive core earning opportunities. For a full list of eligible products, please reference the CSP Product Addendum.
- Global Strategic Product Accelerator –Tier 1, 5%
- Global Strategic Product Accelerator –Tier 2, 10%
- Global PSTN Calling and Conf Accelerator, 20%
- Nonprofit (TSI) Product Accelerator, 12%
Earning split 60% Rebate/40% Co-Op
Customer Adds Accelerator
Customer Add Accelerator – Modern Workplace, 10%
The customer add accelerator rewards partners when their customer, as identified by that customer’s unique TPID, reaches and maintains an initial monthly volume threshold for billed revenue of Modern Work & Security CSP products. Partners can earn up to 12 monthly payments worth 10% of a customer’s monthly billed revenue once the customer reaches and maintains more than $250 USD in monthly CSP billed revenue (or $3,000 USD for annual subscriptions) for the first time in the previous 12-month period.
Customer Add Accelerator – Business Applications, 20%
This two-stage customer add accelerator rewards partners when their customer, as identified by that customer’s unique TPID, reaches a specific initial billed revenue threshold (as set forth below) and again once a subsequent growth threshold (as set forth below) is met. Both thresholds are measured against a customer’s billed revenue arising from Business Applications CSP products. This accelerator is capped at $100,000 USD per customer TPID.
|New customer add||Customer achieves initial $1,000 USD in monthly billed revenue||20% of total annual contract value (ACV)|
|New customer growth||Each time monthly billed revenue exceeds its previous highest total||20% of annual contract value’s (ACV) incremental revenue growth|
Earning split: 60% Rebate/40% Co-Op
Reservation and subscription
Azure Reservation consumption, 10%
This incentive is calculated based on consumption of a pre-purchased monetary commitment on a specific Azure Reservation for Azure Services within a Microsoft Azure offer. Consumption within the Azure Reservation is not eligible for the core Azure incentive rate. Earnings are paid as 100% rebate.
Remember: Azure will be moving out of the CSP program beginning February 1, 2022. You can find detailed information about this change in our previous blog post here.
- Core rate (Windows server revenue): 1.25%
- Strategic rate (SQL server revenue): 6%
This incentive is calculated based on billed revenue from the sale of subscription software products Windows Server and SQL Server. Earnings are paid as 100% rebate. Incentive payments arising from Windows Server revenue are calculated based on the core rate and incentive payments arising from SQL Server revenue are calculated based on the strategic rate. This incentive is paid whether the subscription licenses are used for virtual machines running in Azure or are deployed on-premises through the Azure Hybrid Benefit.
More changes to Microsoft incentives coming with New Commerce Experience
Microsoft’s New Commerce Experience is shaking things up. There will be many more changes between now and March 2022. We will continue to provide updates, so keep an eye on the Sherweb Blog! Sherweb partners are always welcome to reach out to their Account Managers with any questions they may have. We are here to help you navigate the changes and get the most out of the incentives available to you.