Microsoft's New Partner Program is bad news for the average MSP -

Microsoft is making major changes to their partner program and it’s not looking good for most MSPs. Part of these updates includes eliminating Silver and Gold competencies in lieu of a single “Solutions Partner” designation. Microsoft is adding new growth metrics that make it unlikely for the average MSP to qualify for this new designation and subsequent incentives. If you are a Silver partner today or a partner barely attaining Gold, it’s likely that you will not be able to meet the Solutions Partner standards.

As always with Microsoft programs, there is a lot to break down. In this article, I will be diving into the key changes with the new program, timelines, and providing essential resources to help you understand if you will qualify.

Key Highlights

Microsoft is updating their partner program from the Microsoft Partner Network (MPN) to the Microsoft Cloud Partner Program (MCPP)
Legacy competencies will be going away including the Silver and Gold designations
A single Solutions Partner designation will replace Silver and Gold.
Solutions Partner designations will be available starting October 3, 2022. Legacy competencies and associated badging will no longer be valid, but partners that have a competency by September 30, 2022, will continue to receive legacy benefits until their next anniversary date.
If you have an anniversary date after September 30, 2022, Microsoft will provide options to continue to purchase legacy benefits after that time. (Meaning you can pay the fee and still get the incentive kickbacks/IURs after September 30th 2022 through October 2023)
October 1, 2023, and beyond: Attaining a Solutions Partner designation will be required to be eligible for incentives. Legacy competencies and legacy benefits will no longer be recognized as eligible criteria for incentives.
You can track your progress towards Solutions Partner designation in Partner Center today as an admin

Overview

The above pic is Microsoft’s marketing fluff which emphasizes program simplification and mutual growth over time. The new Solutions Partner designations include metrics that we have seen in the past with legacy competencies such as net new customer adds, internal certification achievements, and growth metrics. In fact, Microsoft is now classifying the qualifications into 3 major categories:

Performance (Aka new customer adds)
Skilling (Aka Certs)
Customer Success (Aka Usage and Deployment growth)

After you analyze the new growth metrics associated with these new Solution Partner designations, you realize Microsoft wants “all in” partners. Meaning they are primarily a Microsoft focused shop doing likely over $7k+ MRR in licensing. Everything you need to hit across the board has basically gone up. The Modern Work-SMB solution area (which I believe will be most popular to achieve in the MSP space) already has much higher requirements like 10 new customer adds, 3 certs, and usage growth of 500 monthly active users in a trailing 12-month period. Even the more granular details such as the qualification for a net new customer have gone up with the Paid Available Units (or PAUs) in the tenant now being 10 instead of 5. I believe these types of changes is Microsoft’s way of weeding out people gaming the system to a certain degree like people adding fake tenants just to meet the requirement and getting the incentive kickbacks.

How it works

Microsoft has these 6 new Solutions Partner designations that you can achieve in lieu of the legacy competencies. As a partner, you only need to obtain one and pay a $4,730 annual fee to get the Solutions Partner designation. You can achieve multiple at no additional cost. To achieve the Solutions Partner designation, you have to achieve 70/100 points across the various metric categories shown below.

There is a dashboard in Partner Center that breaks this down a better and is broken out by the solution area. Partner Center shows you your progress to that solution area currently.

Take Note It's good to note that while you only need 70/100 points, you ALSO have to have a point in EACH of the individual metrics. That means you couldn't decide to ignore one of the metric columns like Advanced Certs for instance.

Key Differences in the Programs

Takeaways:

Action Pack isn’t going away

You can still purchase this in the new program and the benefits haven’t changed

Solutions Partner fees are priced at Gold

The annual fee you have to pay for Solutions Partner is priced where the Gold competency used to be.

Metrics are harder to hit

Metrics have gone up across the board with a large emphasis on growth. It is basically more of everything. More customer, more certs, more usage growth.

IURs (Now Called Product Benefits) got better

In comparing the previous IURs with the new product benefit table, you can see clear benefits by being a Solutions Partner. Many MSPs hitting a Silver or Gold competency liked getting the 25-100 licenses of M365 E3. With Solutions Partner Modern Work designation (the designation I feel like most MSPs will go after), you get 200 M365 E5 licenses and 6k credits for Azure (Dev/Test). Of course, its good to point out that I would HOPE these benefits would be better with the increased requirements. For the full product benefit guide, click here: Product Benefits

Incentive Rates Unchanged

In comparing the incentive rates, you can see they are about the same, with no differences in the major categories. I’d be interested to see if that changes over time to encourage partners to move to Solutions Partner.

Getting Started-Partner Center Dashboard

The Solutions Partner Dashboard section now in Partner Center is the best place to get started. You will see the individual solutions designations on the left and clicking on one will pull up the qualification cards to show you how far along you are in each category. You can see all of the requirements on this page as well by clicking View Requirements:

Clicking on view details on the cards can show you more info as well, including metrics across your customer base

Finally, clicking on View Insights on this card will take you to an Insights page to see more telemetry about these data points that can help you visualize how you are trending.

Timelines

Straight from Microsoft:

September 30, 2022: The last date to renew a legacy competency.

October 3, 2022, to the partner’s next anniversary date:

On October 3, Solutions Partner designations will be available to attain.
Partners who meet the requirements, will attain a Solutions Partner designation and receive the new customer-facing badging.
Legacy competencies and associated badging will no longer be valid, but partners that have a competency by September 30, 2022, will continue to receive legacy benefits until their next anniversary date. After that time, we’ll provide options for them to continue to purchase legacy benefits.

On the partner’s first anniversary date after October 3, 2022:

Partners who attain a Solutions Partner designation can choose to move to the updated Solutions Partner benefits or retain their legacy benefits, and pay the corresponding fee.
Partners who don’t meet the requirements for a Solutions Partner designation but who renewed a competency by September 30, 2022, will have the option to continue to pay the fee to retain their legacy benefits.

October 1, 2023, and beyond:

Attaining a Solutions Partner designation will be required to be eligible for incentives. Legacy
competencies and legacy benefits will no longer be recognized as eligible criteria for incentives,
unless otherwise stated in applicable incentive program terms.

Conclusion

The bottom line is that if you are a partner that does not have a Gold competency today, it is unlikely you will be able to meet the requirements for Solutions Partner. Not impossible but unlikely. The best thing to do is to go check out Partner Center to see where you line up today when it comes to the metrics you need to hit. If your current anniversary date for your competencies is after September 30th, 2022 and you cannot meet the requirements of Solutions Partner, you will still have until October 1, 2023 to keep getting payouts. My guess is that Microsoft will just prorate your Silver or Gold fee depending on the time remaining.

Coming off a year with NCE, these addition changes deflate the partner program significantly for many MSPs. Liability concerns from New Commerce coupled with no incentives and little margin don’t provide a great investment for many in the space. I believe this is just another reason why you should be shifting your contracts to a either a per user or per device cost model to eliminate this type of vendor risk if you have not already. I know it’s not as simple as making those changes but clearly Microsoft is deciding to invest in larger players in the ecosystem.

I will keep this article updated with relevant updates over time.