Preparing Your Exit: Strategies for Moving Off the Microsoft Enterprise Agreement
In 2025, Microsoft’s Enterprise Agreement (EA) will become a costly, inflexible relic. Microsoft is phasing out many EA renewals, cutting reseller incentives, and raising prices. Simply signing another 3-year EA could mean higher costs and vendor lock-in.
To stay in control, you need a proactive Microsoft EA exit strategy.
This guide shows how to evaluate Microsoft Enterprise Agreement alternatives, build your BATNA, estimate transition costs, negotiate a supported exit, and ultimately avoid Microsoft vendor lock-in.
For a comprehensive guide, read our overview of Microsoft Enterprise Agreement negotiations.
Why a Microsoft EA Exit Strategy Is Critical in 2025
- EA Renewals Ending – Higher Costs: Microsoft is retiring the EA program for many customers and pushing cloud subscriptions instead. At the same time, license prices are rising (around 5% in 2025). Microsoft has also slashed partner (LSP) incentives for EAs. In short, sticking with an EA may lock you into an outdated, expensive deal.
- Renewal = Lock-In Risk: Renewing a multi-year EA without exploring options hands leverage to Microsoft. The EA’s rigid terms make it hard to scale down or switch providers mid-term. If you renew by default, you might be stuck accepting Microsoft’s terms (and new bundled services) whether you want them or not. Having an EA phase-out strategy for 2025 forces Microsoft to offer better terms or risk losing your business.
Alternatives to EA – What’s Next?
Consider these Microsoft Enterprise Agreement alternatives if you move off EA:
- Cloud Solution Provider (CSP): Buy Microsoft licenses via a CSP partner on flexible monthly terms. This offers agility – you can add/drop licenses as needed – with no long commitment. Be aware that CSP vs EA costs are higher per seat (no volume discount), and you rely on the partner for support.
- Microsoft Customer Agreement (MCA-E): Buy services directly from Microsoft under the Microsoft Customer Agreement. This is a subscription model with no minimums and pay-as-you-go billing (great for Azure consumption). You gain flexibility but lose EA volume pricing. Transitioning from EA to MCA-E means managing more granular subscriptions and potentially paying list prices, in exchange for full control and no lock-in term.
- Multi-Cloud (AWS/Google): Migrate some workloads to Amazon Web Services or Google Cloud to reduce dependence on Microsoft. Adopting a multi-cloud exit strategy away from Microsoft gives you bargaining power. Even if you keep core Microsoft services, running part of your environment on other platforms diversifies your IT footprint. Microsoft will know you have alternatives, which can lead to better offers, and you avoid being 100% tied to one vendor.
Many organizations use a mix: for example, moving some infrastructure to AWS while putting remaining Microsoft 365 users on a CSP deal. The right blend of alternatives can cut costs and prevent Microsoft lock-in.
Why is it important to benchmark Microsoft EA Pricing?
Building Your BATNA
Your BATNA (Best Alternative to a Negotiated Agreement) is your viable backup plan if you choose not to proceed with the EA.
To build a strong BATNA:
- Map Out Your Plan B: Determine how you would license everything without an EA. Price out moving to CSP or MCA-E, and consider non-Microsoft solutions (for instance, shifting workloads to AWS/Google or adopting another vendor’s software). This detailed plan – complete with cost estimates and timelines – is your walk-away option.
- Make It Credible: Demonstrate to Microsoft that you’re ready to execute the plan. You can start a pilot (e.g., migrate a small workload to another cloud or switch a group of users to CSP). Ensure executives support the strategy. When Microsoft sees you have leadership buy-in and real progress toward an alternative, your BATNA carries weight. You’ll either receive a significantly better offer or be prepared to leave on your terms.
Assessing Migration & Exit Costs
Exiting an EA comes with transition costs. Conduct a thorough cloud license transition cost analysis to determine the financial impact.
Key areas:
- Higher Unit Costs: Outside an EA, you lose volume discounts. Expect to pay more per license – often 10–20% higher in CSP or direct subscriptions. Include the loss of discounted “From SA” pricing for upgrades when comparing costs.
- Migration & Overlap Expenses: During cutover, you may incur expenses for both old and new services simultaneously. For example, you may keep some EA licenses active while new systems on AWS or CSP go live. Budget for migration tools, consulting, and temporary dual-running of systems. It’s common to see a short-term spike (perhaps 20% of IT costs) during the transition period. Planning for this ensures it’s a calculated investment, not a surprise.
- Change Management: Account for training and support. If you introduce new platforms (such as Google Workspace or different Azure portals under MCA-E), users and administrators will need orientation. You may also need to replace Software Assurance benefits (such as support hours) with alternative support arrangements. Allocate funds to enable people and processes to adapt smoothly to the post-EA environment.
By estimating these costs early, you can make an informed decision on leaving the EA and set realistic budgets for the transition.
Negotiating Transitional Support from Microsoft
When you inform Microsoft of your exit plans, use that moment to negotiate help for a smooth transition.
Key transitional support options include:
- Bridge Agreement: If your EA end date is near, request a short-term extension instead of a full renewal. Microsoft may offer a 6-month or 1-year bridge contract to cover you during the migration process, without obligating you to a three-year commitment. This avoids a service gap and buys you time.
- Flexibility on Licenses: Request the right to reduce license counts (“true-down”) as you transition users off Microsoft services. Also negotiate price protection – for instance, keep 2024 pricing on any licenses you must maintain during the transition, so cost increases don’t hit you mid-migration. Microsoft might even offer credits or funding for your migration efforts if it means retaining some of your business in the new model.
- Partial Renewal: If you plan to retain certain Microsoft products, negotiate a smaller deal for those instead of a full EA. For example, you could sign an enterprise subscription that includes only Office 365 or Windows, but not Azure. Microsoft often prefers a downsized commitment over losing everything. Just ensure any new agreement has clear exit ramps (like annual renewal options or transfer to CSP) so you aren’t stuck again long-term.
Being upfront about having alternatives lined up (e.g., AWS, Google) will encourage Microsoft to cooperate. The goal is to secure concessions that make your exit easier and preserve flexibility, rather than facing a hard cutoff.
Preserving Flexibility & Avoiding Lock-In
The ultimate aim of an EA exit is greater freedom. To avoid Microsoft lock-in in the future:
- Diversify Vendors and Contracts: Don’t put all your IT eggs in one vendor’s basket. Use a combination of providers and licensing models. For example, run some workloads on Azure and others on AWS, or split your Microsoft services between a direct subscription and a partner. This multi-cloud, multi-model approach means no single vendor has leverage to trap you – you can always shift if needed.
- Embed Flexibility in Agreements: When you negotiate new contracts (with Microsoft or others), insist on terms that preserve your options. Avoid multi-year commitments that lack escape clauses. Consider one-year agreements or the option to adjust usage annually. If you agree to a longer term for a discount, ensure that there are provisions to terminate or renegotiate if your needs change. Always know how you can exit an arrangement before you enter it.
Maintaining this mindset will ensure you stay in control. Microsoft is far more likely to meet your needs when they know you can move elsewhere.
Exit Strategy Framework – Step by Step
Here’s a simple roadmap for executing your Microsoft EA exit strategy:
- Audit Current Usage: Inventory all Microsoft licenses, subscriptions, and workloads in your EA. Identify what you have, what’s used, and when your EA expires. This shows your starting point and highlights immediate savings (e.g., unused licenses that can be dropped).
- Identify Alternatives: Define how each component (e.g., Office, Azure, Dynamics) would be handled outside the EA. For each, choose an alternative path – whether it’s CSP, MCA-E, or a different vendor’s solution. This is the skeleton of your BATNA plan.
- Model the Costs: Compare the Costs of Staying vs. Leaving. Project your costs over the next 3–5 years for each scenario (renew EA, switch to CSP, move to AWS/Google, hybrid approach). Include subscription fees, cloud costs, support, and migration expenses. This analysis shows the financial trade-offs and helps win executive approval for the chosen strategy.
- Negotiate with Microsoft: Engage Microsoft early (months before the EA end). Explain your objectives and what it would take for you to consider staying. Use your cost model and alternatives as leverage. Push for transitional arrangements or discounts that address the gaps. Be prepared to say “no” if the terms fall short of your BATNA value.
- Execute the Transition: If you decide to exit, carry out the migration in phases. Move one set of services or users at a time rather than all at once. Ensure each phase is stable (and licenses properly in place) before moving to the next. Maintain overlap between the old and new systems to prevent users from being disconnected. By EA expiration, all critical workloads should be running on the new arrangements. Finally, wrap up any loose ends (confirm license compliance, turn off auto-renewals, etc.).
Keep leadership and stakeholders informed at each step. A well-governed, phased approach will minimize disruption and set you up for success after the EA.
Read When to Negotiate Your Microsoft EA.
FAQ – What Buyers Need to Know in 2025
- How long does it take to exit an EA? Roughly one year from planning to full transition. It’s wise to start preparing 12–18 months before your EA expires so you have time to evaluate options, negotiate, and migrate gradually.
- What are the hidden costs of leaving? Expect some temporary cost overlap (paying for both old and new services during the migration), loss of volume discounts (resulting in higher per-user costs), and additional expenses for activities such as data migration and user training. Planning and budgeting for these ensures they’re manageable.
- Can we exit the EA partially? Yes. You don’t have to do an all-or-nothing exit. Many companies keep certain products under a smaller Microsoft agreement and move the rest to other platforms. For example, you might keep Office 365 under a subscription but shift Azure workloads to AWS. Microsoft will work with you on a partial approach if it means keeping some of your spend.
- How do we ensure compliance during the transition? Don’t cancel your EA licenses until replacements are active. Maintain overlapping coverage – even if it means double-licensing for a short time – to ensure no usage goes unlicensed. Track your deployments carefully and utilize any grace periods or extensions that Microsoft offers to facilitate a smooth transition. Good software asset management is key during this period.
- What gives us the most leverage with Microsoft? A credible alternative. If Microsoft knows you have a genuine plan to leave (and especially if you provide proof, such as pilot migrations or quotes from AWS/Google), they’ll be more inclined to offer concessions. Also, engage at a high executive level and time your negotiations with Microsoft’s fiscal calendar (end of quarter/year) when they are more likely to be eager to close deals. Showing that you’re informed and willing to walk away is your strongest negotiating card.
Preparing a Microsoft EA exit strategy may seem challenging, but it puts you back in control of your IT roadmap.
Whether you ultimately leave the EA or negotiate a significantly improved deal, the power shifts to you once you have a plan and alternatives in place.
In 2025 and beyond, maintaining flexibility and leverage is essential – and that starts with not being afraid to exit the old model on your terms.
Read more about our Microsoft Negotiation Service.
