The transition in plain terms
Microsoft is restructuring how Enterprise Agreement licensing economics work. The partner commission pool that flowed through the Large Service Provider and Enterprise Software Advisor structures, an estimated $2.5 billion in 2023, collapses to approximately zero this year. The Modern Commerce Agreement for Enterprise and the Cloud Solution Provider direct path are taking over the renewal motion.
The UK Competition and Markets Authority opened a Strategic Market Status investigation into Microsoft business software on May 14, 2026. The public comment window closed on June 4. The structural questions the regulator is examining are the questions enterprise customers and channel partners now have to make their own commercial decisions against.
Customers approaching a 2026 or 2027 renewal are buying into a different commercial model than the one their last renewal entered. The unit economics have changed. The advisory layer that historically lived in the channel has been internalized. The pricing levers are different. The leverage points are different.
Why this matters
The Brushton Group is led by the designer of Microsoft's original Enterprise Agreement direct-billing architecture. The Enterprise Software Advisor model that launched in 2001 is named verbatim in Microsoft's FY2025 10-K, twenty-four years later. The 2026 transition is the unwinding of that architecture.
Independence
Brendan T. O'Connor served as Senior Director at Microsoft Worldwide Licensing and Pricing from 1998 to 2016 and designed the original Enterprise Software Advisor channel architecture. He has had no financial relationship with Microsoft since 2016. The Brushton Group is not a Microsoft partner, reseller, or licensee. Engagements are independent of Microsoft and of any Microsoft channel partner.
Get in touch about this work
If the architectural questions this analysis raises intersect with what your team is navigating, reach out.
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