Summary
If you procure Microsoft software and cloud services, you cannot avoid mentions of the Microsoft Cloud Solution Provider program, or CSP. But what is it? And how can it benefit you as an end-user, not a reseller, nor a Microsoft Partner?
Let's begin with the basics of the Microsoft CSP program: how it works and which products are available.
Then, we'll review licensing differences compared to traditional Microsoft agreements.
And, of course, we'll cover discounts and migration from an Enterprise Agreement.
What is CSP?
CSP is a licensing programme that Microsoft introduced in 2015 to allow you to procure Microsoft cloud services and software licences directly from Microsoft partners, who often bundle them with their services. That was the core idea: you don't simply buy licences and cloud. You purchase tailored IT services with licences included.
Products and services in CSP include Microsoft 365 (ex-Office 365), Microsoft Azure, and a subset of server and desktop licences.
CSP is a relationship between you and Microsoft, with a Microsoft partner in between. The partner will manage your subscription, giving them more control over your customer experience and billing, while providing you with a single point of contact for all your needs, from licences to support.
Although CSP works differently from other licensing contracts like Enterprise Agreement, Select or Open Value, you must still sign a licensing agreement with Microsoft. Your CSP partner will facilitate it. However, there are significant differences between CSP and traditional Microsoft licensing channels:
There are differences in how they operate.
Not all Microsoft products and Microsoft cloud services are available through CSP.
The licensing terms and conditions differ as well.
What does CSP stand for?
Officially, CSP stands for Microsoft Cloud Solution Provider. You may find different interpretations like "Microsoft Cloud Service Provider" or "Cloud Solutions Provider", which are pretty similar and also reflect the core principle of this licensing program. There is a skilled, authorised partner between you and Microsoft that provides you with multiple cloud solutions and services. The partner also manages your "CSP tenant".
Benefits of Microsoft CSP
From the customer perspective, you have more flexibility over how you're billed. You can be invoiced monthly or annually, for example. Annual subscriptions in CSP have a monthly billing option.
You also get one point of contact for support and billing for your licences and cloud usage. The CSP partner is supposed to manage your entire customer journey.
How CSP works, step-by-step
You need to find an authorised Microsoft Cloud Solution Provider program partner who fits your requirements, delivers the services you need, and "clicks" with your business overall.
This Microsoft CSP partner will provide you with a Microsoft Customer Agreement (MCA). Signing the MCA creates a licensing relationship between your organisation and Microsoft.
Your chosen partner is your first line of communication. Depending on their "partner tier", they will provide you with billing and technical support directly (Tier 1, or "direct model" partners) or through their distributor (Tier 2, or "indirect CSP partners"). Microsoft itself will not offer billing or technical support.
Your Microsoft Cloud Solution Provider program partner will help you manage your Microsoft Online Services portal, procure licences, renew subscriptions, and more.
What is a Microsoft Customer Agreement (MCA)?
MCA, or "Microsoft Customer Agreement", is a licensing agreement between Microsoft and the end customer (you). When you acquire Microsoft software licences and services from a Cloud Solution Provider (CSP), your first step is to sign an MCA.
The MCA Agreement is not exclusive to the CSP program. When you purchase Microsoft services through the Microsoft web portal ("Web Direct") or from a Microsoft sales representative ("Microsoft Enterprise Motion" or MCA-E), you must also sign an MCA.
That is why, when you search for CSP licensing terms on the Microsoft Product Terms website, there is no "CSP program" in the drop-down menu. The option you need to choose is "Microsoft Customer Agreement".
Microsoft CSP subscription and perpetual licence availability
CSP was designed to help organisations procure subscription licences and online services more efficiently. CSP also offers some perpetual licences, but please be wary and enquire your CSP partner about perpetual licence limitations.
Since Microsoft ended its Open License program, clients and partners needed a new way to obtain traditional licences without the same commitments as under an Enterprise Agreement. CSP partners also needed a way to remain the single point of contact for all their clients' licensing needs and to sustain more consistent customer relationships.
Microsoft responded by adding a limited number of perpetual licences to CSP. However, that is not the only limitation of product availability. Some enterprise-grade products are unavailable even if you buy them as a subscription.
Not all server products are available as subscription licences, either. The best way to check subscription licence availability is to look at the individual product entries on the Microsoft Product Terms website, for example the SQL Server or Windows Server pages.
Here are the available server subscription licences:
Exchange Server Subscription Edition,
SharePoint Server Subscription Edition,
SQL Server Enterprise Core (2-pack of Core Licences),
SQL Server Standard (2-pack of Core Licences),
System Center Server Management Licences,
Windows Server Active Directory Rights Management Services CAL,
Windows Server CAL,
Windows Server Datacenter (Core Licences),
Windows Server External Connector,
Windows Server Remote Desktop Services CAL (Device and User),
Windows Server Standard (Core Licences).
You can check all the current CSP licence availability on the Microsoft Product Terms website.
Microsoft CSP billing and flexibility (changed in 2022!)
At its introduction, CSP was pitched as a flexible licensing program that allowed you to re-adjust your subscription licences every month.
You may still do so. However, in 2022, Microsoft made the most flexible monthly subscription 20% more expensive than the annual option.
You may choose one of the three subscription types, all of which have a seven-day cancellation period:
Monthly subscription. Your partner will invoice you every month for how much you use. It is the most flexible option, but costs 20% more than an annual subscription.
Annual subscription. You commit for the year in advance. You can pay upfront or be billed monthly, but monthly billing costs 5% more than paying upfront since April 2025. You can't downsize until the end of the subscription unless you cancel within the first 7 days. After that, you will have to pay the remaining subscription fee.
3-year subscription. It is like an annual subscription, but it lasts longer, and there is no monthly billing option for server subscriptions. The upside is that the cost is more predictable.
Microsoft CSP licensing is different from other programs
If you currently purchase your licences through a Microsoft Enterprise Agreement, you may find that similar CSP licences have more restrictive terms and conditions.
Here are a few examples:
Microsoft 365 E3 and E5 offer fewer benefits compared to the same licences procured via a Microsoft Enterprise Agreement. For instance, the MCA Product Terms do not permit installing on-premises Exchange and SharePoint servers, while the EA terms do.
CSP does not have Software Assurance. You cannot buy SA as an add-on in CSP. However, CSP subscription licences are granted rights equivalent to SA for the products they cover, including License Mobility for Windows Server and SQL Server subscriptions since April 2026. CSP perpetual licences do not get these equivalent rights.
Some differences may disappear or be reduced in the future as Microsoft is gradually making CSP the primary licensing channel.
Who is the target audience of CSP?
It may appear that Microsoft designed CSP licensing for smaller businesses with fewer than 2400 licensed users. Indeed, considering available discounts and Microsoft Partner-targeted incentives, organisations of that size benefit from CSP the most.
However, If you represent a large company, Microsoft may offer you a similar licensing solution without a partner intermediary. They call it "Enterprise motion". That is why there is no "CSP licensing program" in the official Microsoft licensing guides. The official name of the licensing framework that underpins both CSP and Microsoft's direct initiatives is "Microsoft Customer Agreement" (MCA).
Negotiating discounts in CSP and MCA
Microsoft Cloud Solution Provider program does not have automatic volume discounts. The price of licences in CSP is the same for every company, regardless of its size. The Microsoft Enterprise Agreement still offers volume discounts on on-premises software, but from November 2025, Microsoft removed automatic volume discounts on online services in the EA, EAS, and MPSA programmes. For online services, everyone now pays the same list price.
When you order licences through a Cloud Solution Provider partner, you must agree on a price with the partner. Microsoft will only negotiate with you if you purchase directly from them.
Migrating to CSP from an Enterprise Agreement
Depending on your circumstances, CSP may be a viable option for your organisation.
Microsoft Enterprise Agreement may still be the best choice if you have over 2400 licensed users, and the way your IT infrastructure is designed may require standard licensing terms and conditions that you get through EA. But you might consider using CSP to augment your licensing portfolio, enabling you to get more out of your Microsoft licences and cloud investments.
If you are evaluating a full or partial switch from an Enterprise Agreement to a Microsoft Customer Agreement, here are a few things you should think about:
What are the differences between licensing through CSP and Microsoft Enterprise Agreement? Do the new rules match how you use Microsoft licences in your company?
Will you lose the discounts you get through EA?
How will you be invoiced?
Do you want to commit to one or three years, choose flexibility but pay 20% more, or mix-and-match flexible and long-term licences?
How does CSP benefit your business growth, digital transformation and cloud migration?
If you need help choosing between CSP, Enterprise Agreement, or a combination, contact us. SAMexpert does not sell Microsoft licences or cloud services, so our advice is independent.