This article provides information on common questions on Enterprise Incentives.
The New incentives rewards partners for generating demand and driving new EA enrollments with our joint customers.
The invoice date is the trigger date for the New incentive. The invoice date is defined as the date the invoice is created or issued and it can be found in the invoice details report in Explore.MS.
The eligible revenue for New incentive is billed new revenue on the original BEC (Basic Enterprise Commitment) as well as any new revenue added during Year 1 on a supplemental BEC (this excludes any True Up, Add On or recurring revenue).
The On-time Renewal incentive rewards partners for timely renewals. The incentive rate is based on the month of the expiring enrollment and earned in the Microsoft fiscal quarter of the renewal. To be paid this incentive, the transacting partner on the renewal (as of the start date of the new agreement) must also be the Partner of Record (POR) on the expiring enrollment (as of the last date of the expiring agreement). Public Sector EAs are not subject to the Partner of Record rule.
Partners are eligible to earn the incentive when the EA renewal is received and accepted on or prior to the end of quarter it is due. The quarter is always defined as Microsoft fiscal quarter (July 1 through June 30th) not three months following the EA expiration. Any enrollment that is renewed after this date is considered aged and not eligible for incentives. The quarter against which renewal will be tracked is determined by the One Day shift rule which is the expiration date + 1 day.
To qualify for the On-time Renewal incentives, the Renewal must meet several compliance criteria:
▪ Renewal must be received by the Microsoft Regional Operations Center before end of the qualifying quarter.
▪ Contract type needs to be the same as the expiring agreement.
▪ The transacting partner must be the POR* on the expiring enrollment. *Except for the Public-Sector deals
▪ The renewal must be for minimum of 24 months.
The On-Time True-Up incentive is paid on the billed revenue for On-Time and Early True-Up orders.
The On-Time True-Up incentive is eligible for True-Up orders that are submitted within following timeframes:
For an updated EA, True-Up orders must be received no less than 30 days prior to the anniversary date
For the prior version of the EA, the True-Up order must be received no later than 15 days after the Enrollment anniversary date
Partners are required to submit Year 3 True-Up orders within the 30 days period prior to expiration.
The Account Services incentive lever rewards partners for processing and fulfilling volume licensing orders accurately and supporting customers with all of their volume licensing needs. With the launch of the FY18 Enterprise Incentives program, the Account Services lever is earned on the recurring revenue at anniversary to recognize the continued volume licensing management efforts undertaken by the partner.
Account Services will no longer be paid on all EA revenue and is not eligible for new, renew, or midterm (Additional Products, Ontime TUP, EAS Upsell) orders. Please note: Azure revenue is excluded from the Account Services fee and is paid separately through the Azure specialized lever.
The Additional Products incentive lever rewards the partner throughout the life of the EA (or EAS). This applies to all Add-On revenue during an EA (except True Up orders). Following sales will qualify as eligible for Additional Products:
1. Purchase Order type New Order (“NE”) – All revenue.
2. Purchase Order type Basic Enterprise Commitment (“BEC”) – All new Add On revenue added during the course of EA (excluded New, Renewal and Recurring).
EAS Upsell Revenue Recognition Incentives lever will recognize all net-new revenue added to an existing EAS agreement at anniversary or prior to the agreement expiration. Microsoft will perform a calculation determining the increase in size of an Enterprise Agreement Subscription at the time of the anniversary.
Revenue Baseline: The revenue baseline will be determined at the agreement start date based on the initial Basic Enterprise Commitment revenue and it will adjust annually to the highest of any subsequent paid on revenue (that revenue recognized and paid on at the anniversary date).
Revenue Floor: No incentive pay-out will be made on agreements with annual order revenue less than the revenue baseline amount at agreement anniversary.
Revenue Decline rule: If the revenue declines YoY, no incentive will be paid nor will a “clawback” be initiated. Microsoft reserves the right to audit new orders on an existing EAS as deemed necessary.
Specialized Levers & Local Accelerators
Azure Specialized Lever
The Azure specialized lever will pay 4% on all billed azure revenue including new, renew, and overage billing orders. There is a $200,000 USD annual (program year) maximum cap per enrollment on this lever. Please note: all other Enterprise Incentive levers do not apply.
CASA/EES Specialized Lever
The CASA/EES specialized lever pays a fixed rate on all eligible revenue, regardless of deal level, as outlined below. The other Enterprise incentive levers do not apply.
Local accelerators are determined at the subsidiary level and refreshed on a semester basis. For additional information around regional Enterprise Incentives accelerators, please review your regions specific accelerator letters also referred to as Exhibit L.
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