A few years ago the majority of Microsoft software licences for the NHS were centrally purchased and managed through a government Enterprise Wide Agreement. That’s all changed now, and the NHS has to locally manage from their individual agreements, budgets and compliance. We’re going to give you some of the history behind the most current developments in this area, how it affects the public sector and what comes next.
What’s the Select Plus License agreement?
Microsoft launched the Select Plus licensing agreement in the UK on 1 October 2008 as an ‘evergreen agreement’ (agreement that never expires) for medium to large organisations with 250 or more desktop PCs.
However, the latest news at July’s Worldwide Partner Conference was that Microsoft will retire the Select Plus licensing agreement in July 2015, having already phased in the replacement Microsoft Products and Services Agreement (MPSA) – and they claim that this will help simplify licensing agreements for organisations. Currently MPSA licensing is available in the United Kingdom, as well as in 17 other countries.*
How long until Select Plus agreements are terminated completely?
Microsoft will no longer offer new commercial Select Plus agreements after July 2015, though existing Select Plus customers can continue to purchase via their Select Plus agreements. After July 2016, customers whose agreement anniversaries have passed will no longer be able to make new purchases through their existing Select Plus agreements, and all future purchases will be moved to the MPSA. In the event that the MPSA is not available in your country by these dates, Select Plus will continue to be offered until 90 days after MPSA availability.
Which is the better deal of the two packages?
MPSA offers much more flexibility and benefit to customers at no extra cost, level of discount and purchasing flexibility than Select Plus, and includes Office 365 services under the same agreement allowing easier procurement of Office 365 services alongside traditional on-premise software.
Should public sector customers be worried?
The Select Plus retirement announcement shouldn’t cause alarm to customers, and indeed may not require immediate action as Microsoft only plans to broaden MPSA availability in Europe and Australia this coming autumn. On 1 September of this year, Microsoft plans to add Software Assurance (SA) benefits to its MPSA licensing – it’s not clear why Software Assurance wasn’t initially offered with MPSA licensing.
So what does this mean for the NHS and other UK public sector customers specifically?
This change does not apply currently to Select Plus agreements for UK government and academic customers. The Crown Commercial Service, or CCS, hold a memorandum of understanding with Microsoft called the Public Sector Agreement 2012 (PSA12), which is effective from 1 May 2012 until 30 April 2015 – and has succeeded PSA09. Some organisations have opted to extend and continue using PSA09, and the rest have migrated to PSA12, depending on which has the most favourable commercial and licencing terms.
PSA12 is not a vehicle for purchase of software licenses like Select Plus or MPSA but sets key commercial terms between Microsoft and eligible public sector customers. Here’s a summary of these terms and differences from PSA09:
- Perpetual enterprise agreement true–down (the cancellation of unused software licenses) up to 10% of entitlement once during the 3 year term
- Perpetual license transferability across public sector organisations
- Reduction of desktop numbers required to enter an enterprise agreement (100 from 250)
- Increased discounts over existing levels in PSA09
- 5% additional discount for Select licensing and software assurance on all products
- 5% additional discount for enterprise products purchased through Enterprise Subscription Agreements
- 15% additional discount for enterprise products on perpetual Enterprise Agreements (licensing and software agreements)
- Extended eligibility criteria to include social enterprises
- 3 + 1 + 1 year agreements are retired, replaced with standard 3 year terms
What further Microsoft changes lie ahead for the NHS and UK public sector?
Ahead of the PSA12 expiry in April 2015 (and no doubt keeping in mind the UK general election on 7 May 2015) the Crown Commercial Service is now heading up a cross public sector working party, including members of Essentia’s software asset management team, to debate future Microsoft licence requirements in PSA15. We’ll be keeping you updated, so make sure to check back on our blog and news postings to find out the latest.
Andy Hill is Essentia’s Head of Software Asset Management – need more advice on how to get the best deal for your organisation? Get in touch at email@example.com
*Currently the MPSA is available in the United States, United Kingdom, Germany, Canada, France, Poland, Netherlands, Denmark, Italy, Switzerland, Austria, Belgium, and Ireland. MPSA will be available in Australia, EU/EFTA countries/regions, Japan, Brazil, and Russia in 2014, and it will be rolled out globally in 2015.