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Microsoft Killing Its Most Popular Partner Benefit, IURs

Editor's Note: Due to partners' negative reaction to these changes, Microsoft on July 12 announced that it was rescinding the plan to end the internal use rights benefit. See RCP's coverage here.

An announcement on Microsoft's partner Web site indicates that the popular internal use rights (IUR) benefit will be discontinued in less than a year.

IURs allow Microsoft partners to run their business on Microsoft software, from their Windows desktops to all of the back-end servers to the newer cloud services. They were consistently rated one of the best features of Microsoft's partner program in RCP surveys and cited as a key benefit in partner interviews over the years.

"Effective July 1, 2020, we will retire the internal use rights (IUR) association with the product licenses partners receive in the Microsoft Action Pack and included with a competency. Product license use rights will be updated to be used for business development scenarios such as demonstration purposes, solution/services development purposes, and internal training," Microsoft said in the low-profile announcement on the partner Web site.

"Beginning October 1, 2019, the product licenses included with competencies will be specific to the competency you attain. Please review the benefits you will receive with your competency in Partner Center at time of purchase. Additional licenses can be purchased through commercial licensing to run your business," the statement continued.

The licenses, similar to not-for-resale benefits in other vendors' partner programs, were much more valuable than the sticker price of subscribing to the Action Pack or paying the fee to attain a Silver or Gold competency. In general, Action Pack subscription IURs would support a business of about 10 employees. Silver competency IURs could run a business of about 25 employees, and Gold competency IURs would support a business of about 100 employees.

In a Facebook post, former International Association of Microsoft Channel Partners (IAMCP) president Kelvin Kirby described himself as "reeling" from the announcement.

"Another example, if any were needed, of the continued erosion of benefits to Microsoft Partners and evidence of complete chaos in the MPN [Microsoft Partner Network] program. This must be the worst move by Microsoft in 30 years and may see the end of the MPN program as we know it today. A very sad day. I hear on the Partner grapevine that there is uproar in the MPN community about this. Not at all unsurprising. Will be interested to see how Microsoft survives Inspire after this rather critical announcement," Kirby wrote in a reference to the Microsoft Inspire partner conference that starts the week after next.

IURs were one of the ultimate symbols of the enlightened self-interest of the MPN. By encouraging its competency partners and Action Pack subscriber partners to run their entire business on Microsoft's stack, Microsoft ensured that those partners knew the software and services inside and out and understood fully how to leverage the benefits of the tools by lighting up all of the features.

Update 5:30 p.m.: A Microsoft spokesperson confirmed the changes Friday afternoon with an e-mailed statement putting the decision on IUR benefits in a broader context:

The transformation enabled by cloud computing has wide ranging impacts, including how we work with partners. To help partners capitalize on the opportunities possible with cloud, we are refocusing our partner business investments and programs. We outlined our approach to these investments in our recent blog post, Investing in partner success and growth. A snapshot of these changes includes:

  • In August 2019, we are retiring the on-premises product support incidents currently included with Silver and Gold competencies and in the Microsoft Action Pack, effective when partners renew their existing competency or subscription beginning August 2019.
  • Partners with competencies will continue to have access to cloud support services to support their customers.
  • Partners that attain a competency will receive product licenses that are aligned to the products and technologies specific to that competency.
  • The Microsoft Action Pack remains available for purchase for partners that want access to the latest Microsoft products and technologies for business development scenarios such as developing innovative applications and services, demonstration purposes, and internal training.
  • Beginning July 1, 2020, we will be updating the terms of use for product licenses to remove the internal use association.
  • Partners can review the changes for the competency or competencies they have on the Competency review page of the Microsoft partner website.

Posted by Scott Bekker on July 05, 2019


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