Microsoft Shifts Risk onto Partners with Channel Strategy Changes

Microsoft's recent changes to its channel strategy have left partners feeling burdened by increased risk and responsibility. According to several resellers, the vendor has shifted more of the financial exposure onto distributors, resellers, and third-party providers through programs like Cloud Solution Provider (CSP) and New Commerce Experience (NCE).

The CSP and NCE programs have expanded partner obligations over the years, requiring resellers to carry greater exposure to customer non-payment, fraud, and insolvency events. Microsoft has also tightened cancellation and subscription management policies, placing a greater emphasis on partner-led customer acquisition, retention, and growth.

One of the main concerns is the introduction of Extended Service Terms (EST) for CSP subscriptions, which replaces the previous free post-expiry grace period with a paid extension option. This means customers must either renew, cancel at expiry, or move to EST, billed at the monthly subscription rate plus a three percent uplift for most eligible subscriptions.