As of January 2025, Microsoft has begun phasing out Enterprise Agreement (EA) renewals for mid-sized organizations, primarily those with 500 to 2,400 users on the Level-A Enterprise Agreement (EA) model. These customers are now encouraged to move to the Cloud Solution Provider (CSP) model for continued access to Microsoft licensing and services.
This shift reflects Microsoft’s broader strategy to enable more personalized and service-driven engagement through partners. By transitioning to CSP, businesses can benefit from flexible billing, access to expert guidance, and value-added services tailored to their evolving needs, especially as AI adoption grows.
EA to CSP: What Does It Mean to Mid Sized Businesses Using Microsoft Licenses? If your organization falls within this segment, now is a good time to review your licenses and explore the best available options in CSP. To help make the transition smooth and aligned with your goals, you need to work with a Microsoft-certified Cloud Solutions Partner with a proven experience in licensing, cloud, and enterprise support.
Microsoft’s licensing update primarily affects customers under Level A of the EA program, specifically, those with 500 to 2,400 users by phasing out renewals under the traditional Enterprise Agreement (EA) model. This doesn’t mean services will stop. If you’re currently on an EA, your existing subscriptions and products will continue as usual until the end of your agreement term.
Opportunity to Re-evaluate Licenses and Costs with Trusted Guidance The transition period presents a natural checkpoint to review how your organization consumes Microsoft services. You can assess whether your current licensing structure still aligns with your actual usage patterns and business objectives and use this as an opportunity to explore all CSP promos, bundles, and transition paths.
Working with a certified partner during this evaluation can provide insights into:
Current license utilization and potential optimization opportunities Alignment between your licensing and actual business needs Cost analysis across different licensing approaches Review of upgrade paths and the Microsoft promos and incentives available EA Remains Valuable and Available for Larger Organizations Enterprise Agreements continue to serve many organizations effectively, particularly larger enterprises and those in specific market segments. Organizations outside 2,500 user range may find EA continues to be their optimal licensing model. Microsoft hasn’t eliminated EA entirely; they’ve simply adjusted which customer segments they’re directing toward each model.
Kanerika: Your Partner for All Microsoft Licensing, Funding and Services When choosing a Cloud Solution Provider, you need more than someone to process licenses. At Kanerika, we go beyond transactions—we act as your strategic Microsoft partner from start to finish.
We view Microsoft licensing as the foundation of your digital transformation journey, not the end goal. Our comprehensive partnership model ensures you maximize every dollar invested in Microsoft technologies while building a scalable, future-ready IT infrastructure.
1. Effortless Microsoft License Transition with Full Migration Support Whether you’re moving away from an Enterprise Agreement or starting with CSP for the first time, we take care of the entire shift.
Full license audit and optimization to avoid over- or under-licensing Mapping all promos, discounts, and funding opportunities End-to-end license transition planning and execution Compliance alignment with Microsoft’s CSP requirements Hands-on training to ensure smooth user adoption for license upgrades 2. Retain Your Microsoft 365 and Teams Access Without Downtime Your business shouldn’t be affected during a licensing change. With Kanerika, you retain all existing Microsoft entitlements—including Microsoft 365, Teams, and other apps—without loss of features or functionality..
3. Real Support from Microsoft Certified Professionals You won’t be stuck in automated chat loops or faceless support tickets.
Provide timely, accurate answers Actively manage your account and optimize usage
4. Flexible, Predictable Microsoft Licensing and Billing We offer monthly or annual billing options tailored to your operational and cash flow needs.
Scale licenses up or down anytime Transparent invoicing with no hidden costs 5. Beyond Licensing: Microsoft Services and Strategy Support When you work with Kanerika, you get a partner who helps you build, scale, and optimize your entire Microsoft stack . We’re not just here to help you buy licenses. We support your broader goals through:
Microsoft Fabric: A Game-Changer for Data Engineering and Analytics Unlock new possibilities in data engineering and analytics with Microsoft Fabric’s robust, all-in-one solution for streamlined insights and efficiency.
Learn More
6. Get Full-Stack Microsoft Expertise We’re not new to this. We bring deep, certified expertise across the entire Microsoft technology stack. That means you get smart advice, better implementation, and long-term results.
Our Microsoft Credentials:
Microsoft Solutions Partner – Digital & App Innovation (Azure) modern DevOps practices . Microsoft Solutions Partner – Infrastructure (Azure) cloud infrastructure .
7. Microsoft Funding Programs to Cut Your Licensing and Service Costs Microsoft offers various funding initiatives to support digital transformation for partners that hold Specializations —and Kanerika helps you qualify and use them effectively. We guide you through the process and help structure projects that align with Microsoft’s funding criteria—so you save more while doing more.
We help unlock access to:
ECIF (End Customer Investment Funds): For covering costs tied to pilots, PoCs, deployment, consulting, and adoption services. Azure Innovate: Ideal for businesses modernizing infrastructure, migrating to Azure, or exploring AI/analytics use cases. 8. Microsoft Training Programs That Turn Users into Power Users Empowering your team is just as important as choosing the right tools. Kanerika is a Microsoft-certified training delivery partner , offering hands-on enablement sessions that help teams get real value fast. These aren’t generic webinars—they’re interactive sessions , customized for your business context and delivered by experts.
Workshops we deliver:
Fabric Analyst in a Day (FAIAD): Learn Microsoft Fabric for unified data and analytics workflows. 9. Leading With Microsoft’s Newest Tech Kanerika is proud to be among the first global implementors of:
Microsoft Fabric – Unified platform for data integration , engineering, and real-time analytics Microsoft Copilot 10. Certified Microsoft Experts and Proven Delivery Leadership We bring more than credentials—we bring experience and consistency that ensures your Microsoft stack works the way it should.
35+ Microsoft-Certified Professionals cover everything from Azure infrastructure to data engineering and licensing. MVP-level leadership means your projects are led by professionals with deep insight and recognition from Microsoft. Frequently Asked Questions What is Microsoft EA licensing? Microsoft Enterprise Agreement (EA) is a volume licensing program designed for organizations with 500+ users or devices. It offers discounted pricing for a 3-year commitment and centralized license management. EA customers have a direct relationship with Microsoft and must commit to minimum license quantities throughout the term.
What is Microsoft CSP licensing? Microsoft Cloud Solution Provider (CSP) licensing allows organizations to purchase Microsoft products and services—like Microsoft 365 and Azure—through a certified partner. It offers flexible monthly or annual billing, no minimum license requirements, and value-added services such as support, migration, and consulting.
What is a Microsoft MCA agreement? EA is a 3-year contract with fixed pricing, direct billing from Microsoft, and volume discounts for large enterprises (500+ users). CSP offers flexible billing (monthly/annual), no long-term commitment, and services delivered through a Microsoft partner. CSP is ideal for mid-sized businesses needing support and scalability.
What is the difference between EA and CSP? EA is a 3-year contract with fixed pricing, direct billing from Microsoft, and volume discounts for large enterprises (500+ users). CSP offers flexible billing (monthly/annual), no long-term commitment, and services delivered through a Microsoft partner. CSP is ideal for mid-sized businesses needing support and scalability.
Why move from EA to CSP? Many EA customers, especially those with 500–2,400 users, are no longer eligible for renewals. Moving to CSP offers more flexibility, cost control, and access to expert partner support. It’s also aligned with Microsoft’s shift toward a cloud-first, partner-driven licensing model.
What are the benefits of Microsoft CSP? CSP offers flexible billing, no minimum seat requirement, easy scalability, and direct access to partner services. Customers can bundle licenses with migration, support, cloud services, and cost optimization. It also enables faster access to Microsoft innovations and funding programs like ECIF and Azure Innovate.
Does Microsoft CSP include Software Assurance? No, Microsoft CSP does not include traditional Software Assurance (SA) benefits. However, many of the features previously offered under SA—such as version upgrades and deployment planning—are now integrated into cloud services or provided by partners as part of managed services.
What are the different types of Microsoft licensing? Microsoft offers several licensing types to fit different business sizes and usage needs. The main categories include perpetual licenses, which are one-time purchases that grant permanent rights to a specific software version, and subscription licenses like Microsoft 365, which provide ongoing access with regular updates. Volume Licensing programs such as Enterprise Agreements (EA), Microsoft Customer Agreement (MCA), and Open Value are designed for organizations purchasing multiple licenses at scale. Cloud Solution Provider (CSP) licensing lets businesses buy through authorized partners with flexible monthly or annual billing. For developers and IT professionals, Visual Studio subscriptions bundle software access with dev tools. Kanerika can help understand which model applies to your organization matters especially when Microsoft announces licensing changes.
What are the different types of Microsoft licenses? Microsoft offers several core license types depending on how software is deployed and used. Perpetual licenses give you a one-time purchase with permanent usage rights but no guaranteed updates beyond a fixed support window. Subscription licenses, like Microsoft 365, provide continuous access tied to ongoing payments, with regular feature updates included. Volume licenses are designed for organizations buying multiple licenses at once, often through programs like Microsoft Open, Select Plus, or Enterprise Agreements. OEM licenses come pre-installed on hardware and are tied to that specific device. Cloud licenses govern access to Azure and other cloud services, typically billed on consumption or per-user models. Understanding which license type applies to your infrastructure matters significantly when Microsoft announces pricing or policy changes, since the impact varies across license categories and agreement terms.
What is an E1, E3, and E5 license? Microsoft 365 E1, E3, and E5 are tiered enterprise licensing plans that offer progressively more features and security capabilities. E1 is the entry-level plan covering core productivity tools like Teams, SharePoint, and Exchange Online but excludes desktop Office apps. E3 adds full desktop Office applications, advanced compliance tools, and device management features, making it the most common choice for mid-sized organizations. E5 is the premium tier, layering in advanced security, threat protection, Power BI Pro, and audio conferencing on top of everything E3 includes. The right tier depends on your security requirements, compliance obligations, and how deeply your teams use Microsoft’s analytics and communication tools. Organizations undergoing digital transformation often find E3 or E5 licensing unlocks capabilities they were previously paying for separately, which can actually reduce overall software spend.
What is licensing in Microsoft? Microsoft licensing refers to the legal framework that governs how individuals and organizations can use Microsoft software products and services. It defines the terms of use, number of permitted users or devices, deployment rights, and compliance requirements for products like Windows, Microsoft 365, Azure, and Dynamics 365. Microsoft offers several licensing models to match different business needs. Subscription-based licensing through Microsoft 365 or Azure covers cloud services on a per-user or consumption basis. Perpetual licensing applies to on-premises software like certain versions of Office or Windows Server, where you pay once for indefinite use. Volume licensing programs such as Enterprise Agreements are designed for larger organizations needing to manage software at scale. Understanding which licensing model applies to your environment is critical for cost control, compliance, and avoiding penalties during audits.
What is a Microsoft Basic license? A Microsoft Basic license is a lower-tier subscription option that provides access to core Microsoft services — typically email, calendar, and limited cloud storage — without the full suite of productivity applications like Word, Excel, or PowerPoint desktop apps. It’s commonly offered under Microsoft 365 Business Basic, which includes web and mobile versions of Office apps, Microsoft Teams, SharePoint, and OneDrive, but excludes installed desktop software. This makes it a cost-effective choice for organizations where employees primarily work through browsers or need collaboration tools without full desktop app access. For businesses evaluating licensing tiers, understanding what Basic includes versus higher tiers like Business Standard or Premium is essential to avoid paying for unused features or, conversely, running into capability gaps that affect productivity and compliance requirements.
What is the difference between E1 and F1 licensing? E1 and F1 licenses serve different worker types: E1 is designed for office-based knowledge workers who need full productivity tools, while F1 targets frontline workers like retail staff or factory floor employees who primarily need lightweight communication and task management features. E1 includes the full web and mobile versions of Office apps, Exchange email with a 50GB mailbox, Teams, SharePoint, and OneDrive with 1TB storage. F1 is more limited, offering Teams for communication, a 2GB mailbox, and basic task tools, but excludes desktop Office applications and full email functionality. Cost reflects these differences: F1 is significantly cheaper, making it practical for large frontline workforces. Choosing the wrong license tier is a common source of unnecessary spend. Organizations with mixed workforces should audit actual usage patterns to align license types with real needs before renewing agreements.
What are the four types of Microsoft Office? Microsoft Office comes in four main types: Microsoft 365 (subscription-based, cloud-connected), Office 2024 (one-time purchase, perpetual license), Office LTSC (Long-Term Servicing Channel, designed for enterprise and regulated industries needing stable, infrequent updates), and Microsoft 365 Apps for Business or Enterprise (subscription plans with advanced security, device management, and cloud storage). Each type serves different needs — Microsoft 365 suits organizations wanting continuous feature updates and cloud integration, while perpetual licenses like Office 2024 appeal to those preferring a fixed cost without ongoing subscriptions. Office LTSC is common in environments where software stability and compliance matter more than new features. Understanding which type fits your infrastructure is critical when evaluating licensing changes, and organizations working with partners like Kanerika can assess the right fit based on their operational and compliance requirements.
What is a Microsoft software license? A Microsoft software license is a legal agreement that grants users or organizations the right to install, access, and use Microsoft software products under specific terms and conditions. It defines how many devices or users can run the software, what features are accessible, and any restrictions on usage or redistribution. Licenses vary by product type, covering everything from Windows operating systems and Microsoft 365 subscriptions to server software like SQL Server and Azure cloud services. Organizations typically choose between per-user, per-device, or subscription-based models depending on their size and workload. Understanding your license type matters because non-compliance can trigger audits, financial penalties, or service interruptions. As Microsoft continues evolving its licensing structure, Kanerika can help stay current with agreement terms and hellp avoid unexpected costs.
What is the difference between O365 and M365 licensing? O365 (Office 365) covers core productivity apps like Word, Excel, Outlook, and Teams, while M365 (Microsoft 365) bundles those same apps with advanced security, device management, and compliance tools. The key distinction is that M365 includes Microsoft Intune for endpoint management, Azure Active Directory Premium, and Microsoft Defender for Business, making it a more complete solution for organizations managing security and compliance alongside productivity. O365 suits smaller teams focused purely on collaboration and document creation, whereas M365 is better positioned for businesses with regulatory requirements or distributed workforces needing centralized device control. Microsoft has been gradually phasing out standalone O365 branding in favor of M365, so understanding which plan tier maps to your current entitlements is critical when renewing or migrating licenses to avoid unexpected gaps in access or security coverage.
What is the difference between E5 and G5 license? E5 and G5 licenses offer the same Microsoft 365 feature set, but E5 is designed for commercial enterprises while G5 is built specifically for U.S. government agencies and must meet stricter compliance requirements like FedRAMP High authorization and data residency in U.S.-based datacenters. Both tiers include advanced security, compliance, analytics, and voice capabilities. However, G5 operates within Microsoft’s Government Community Cloud (GCC) or GCC High environments, which restrict data access to screened U.S. persons and enforce ITAR, CMMC, and other federal regulatory standards that commercial E5 does not address. Pricing also differs, with G5 typically carrying a higher cost due to the additional compliance infrastructure. Organizations in defense, federal agencies, or regulated government contracting should evaluate G5, while private-sector enterprises generally use E5.
What is a P1 and P2 license in Azure? Azure P1 and P2 licenses refer to Microsoft Entra ID (formerly Azure Active Directory) Premium tiers that unlock advanced identity and access management features beyond the free tier. P1 (Premium 1) includes conditional access policies, self-service password reset, hybrid identity support, and multi-factor authentication management — covering most enterprise security needs. P2 (Premium 2) adds everything in P1 plus identity protection with risk-based conditional access, privileged identity management (PIM), and access reviews, which are critical for organizations with strict compliance requirements. Both licenses are typically bundled into Microsoft 365 E3 (P1) and E5 (P2) plans, so many organizations already have access without realizing it. Kanerika can help avoid redundant purchases or gaps in identity security coverage during any Microsoft licensing change.
What is the difference between an E1, E3, and E5 license? Microsoft 365 E1, E3, and E5 licenses are tiered plans that offer progressively more features, with E1 being the entry-level option and E5 the most comprehensive. E1 covers basic productivity tools like Teams, Exchange Online, and SharePoint, but excludes desktop Office apps. E3 adds full desktop Office applications, advanced compliance tools, and Windows Enterprise rights, making it the most common choice for mid-size businesses. E5 builds on E3 with enterprise-grade security, advanced threat protection, Power BI Pro, and analytics capabilities, typically suited for organizations with strict compliance or security requirements. Pricing follows the same progression, so the right tier depends on your workforce’s actual needs. Overbuying E5 licenses for users who only need email and Teams is a common cost leak. Conducting a license utilization audit before your renewal cycle helps right-size your Microsoft investment.
