Microsoft's partner ecosystem is changing. For direct-bill partners, that means higher requirements, closer scrutiny, and a stronger case for moving to distribution. Here's what's happening and why you shouldn’t assume you are unaffected.
Across the industry, vendors are tightening their partner ecosystems. Microsoft is doing it more decisively than most. And for a meaningful number of direct-bill partners, the changes now underway are more consequential than they've been willing to admit.
That’s because this isn't a routine policy refresh. It's a programmatic, centrally driven restructuring which means that size, history, and a strong local relationship with a Microsoft account team do not provide the protection some partners may assume they do.
Put simply, this offboarding program does not have exceptions built in for goodwill.
Microsoft is consciously shifting more of its partner business through distributors. For partners currently on direct-bill models, that's a signal you need to notice. The indirect route is no longer a fallback: it's where Microsoft increasingly wants business to flow.
The goal is a leaner, better-skilled partner ecosystem and the mechanism for achieving it is a substantial raising of the bar for direct-bill participation.
From October 2025, direct-bill partners had to meet updated eligibility criteria: a minimum CSP revenue figure, at least one Microsoft solutions partner designation, and an active support agreement.
None of these are one-time onboarding checkboxes. Partners are now subject to annual operational assessments, verified against their program anniversary date each year.
This process isn't arbitrary and it isn't sudden. Partners can track their standing directly in Partner Center. If requirements aren't being met, Microsoft issues a warning and from there, the clock runs in clear stages.
Risk notifications can begin 90 days before the partner’s anniversary month and continue through the lead-up period if requirements are still unmet. If nothing has changed by the anniversary month, end users can receive a notification telling them they need to find a new partner.
That timeline is rolling and completely partner-specific. There's no single global deadline: every partner has their own anniversary date and the assessment runs against it every year, so offboarding exposure isn't a one-off risk. It's an ongoing one. That makes it predictable but in this instance predictability isn't the same as safety.
We can already see that some direct-bill partners are getting caught out because they imagined their size or influence would provide a buffer, ignoring the fact Microsoft’s requirements are being applied consistently, centrally, at program level.
Of course, it’s easy to think of offboarding as just another admin headache. But it isn't. It's potentially a customer relationship problem and a reputational one too.
When a customer gets an email telling them their partner can no longer serve them, the disruption and the damage to trust is immediate. Customers will not think about the intricacies of program compliance. They will just know they’ve been let down by their supplier.
With this background in mind, now is a good time to think about the upsides of the distribution model. For many partners, there are good reasons why it can be a better way to operate.
SoftwareOne is already helping partners work through this. Dialect Group, for example, didn't wait for a warning notice before they acted. With multiple subsidiaries and thousands of customers, they quickly understood the value of working as an Indirect reseller rather than a Direct Bill partner.
As Camilla Kargus, Business Manager at Dialect Group, explained: “We wanted to get ahead of any possible issues and be proactive. The pivot took a bit longer than expected because of the onboarding process but once it was done we all felt the benefits immediately and they exceeded our expectations.”
With SoftwareOne as their distributor, billing (previously a full-day manual process each month) is now automated and support response times have fallen from several weeks to a day or two.
Partners don't need to be staring down an offboarding notice to benefit from acting now. Like Dialect Group, many partners working with SoftwareOne today have already made the move into distribution proactively because they could see where things were heading and got ahead of it.
Your first steps are very straightforward.
Check your Partner Center status, know your anniversary date, have a conversation with SoftwareOne about what a transition would actually look like and what benefits you could starting enjoying immediately by making the move to distribution.
We're Microsoft experts. Ask us about the offboarding program and we’ll get right back to you
We're Microsoft experts. Ask us about the offboarding program and we’ll get right back to you
