Microsoft 365 SKU changes: What customers need to know

By Nick Hakala  Posted December 4, 2018  In Cloud, Microsoft, Software, Volume Licensing

If you use Microsoft 365 E3 or E5 subscriptions, heads up – an important change is happening.

On November 1, 2018, Microsoft introduced new SKUs for Microsoft 365 E3 and E5 that will show up as a single line in the Admin Center and License Summary. They’re designed to be easier to assign and manage, though like any software licensing change, can elicit initial questions or confusion.

What the changes mean for existing customers

If you’re an existing Microsoft 365 subscription customer, the best course of action is to keep doing what you’re doing. However, it may not be that simple.

For you, each Microsoft 365 component – Office 365, Windows Enterprise, EM+S – has its own separate entry in the Admin Center and License Summary. You should purchase or reserve Microsoft 365 E3 and/or E5 the same way you have been and continue to turn on and assign all of the components individually. The new SKUs should have no bearing on how you operate, and you should ignore them.

If you use the reservation system in Microsoft’s Volume Licensing Service Center (VLSC), it’s important that you use the “Original” entries, not the new or “V2” option. In fact, when you look at your license and subscription entitlements, you will now see that you own Microsoft 365 E3 “Original” or E5 “Original.”

If you end up ordering or reserving the wrong SKU, you could encounter significant problems. For instance, standard processes don’t allow you to order or reserve the new SKUs and activate them using the old online services subscriptions.

Also, reserving the wrong option could break the price-lock built into your Enterprise Enrollments. Price-locking is done for each individual SKU, and we’re talking about new SKUs. So even though the actual product and service are the same, if you were to order or reserve the new SKU, you would be subject to the current subscription price for that month rather than a previously locked in (and likely lower) price.

If you want to start to use the new combined Microsoft 365 E3/E5 SKUs and assignment process, you will need to unassign all your current users from their O365 and EMS subscriptions and assign them over to the new combined Microsoft 365 E3/E5 option. This is true even if you want to make the change at your EA renewal time. Microsoft is not facilitating this change for their customers.

What the changes mean for new customers

If you’re a new customer, the SKU changes were made for your benefit, and you should reserve or purchase Microsoft 365 E3 and/or E5 using the new SKUs. They are easier to assign and manage. Simply purchase Microsoft E3 or E5 as one line-item, and you need to turn on and assign only a single service load rather than Office 365, Windows Enterprise, EM+S separately. This makes assignment of this subscription bundle easier, and also helps ensure all components go to the same individual to better ensure compliance with software licensing rules and restrictions.

Final thoughts

Microsoft is always looking for ways to make things simpler and less complicated. The introduction of these new Microsoft 365 E3 and E5 SKUs does exactly that, making it easier for new customers to track subscriptions, while cutting down on time and energy. So long as existing customers remember to continue operating the same way they always have, they shouldn’t experience any problems.

Carrie Alejandro contributed to this post.

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