Microsoft ISV Cloud Embed Program Last Updated June

Microsoft ISV Cloud Embed Program Last Updated: June 2020

What is ISV Cloud Embed The Cloud Embed is an OEM*-only licensing model that offers Dynamics 365 and Power Apps licenses at a discount to help you build on the Power Platform and extend first-party Microsoft solutions. Microsoft Business Applications ISV Connect partners can apply to the Cloud Embed program Joining the ISV Cloud Embed program allows ISVs to acquire Dynamics 365 and Power Apps discounted licenses to create unified solutions that include those licenses and ISVs own business IP. This can be particularly useful when ISVs customers don’t have existing Dynamics 365 or Power Apps licenses already. For ISVs customers who do run their own underlying Dynamics 365 and Power Apps solutions which they procured directly from Microsoft (e. g. , via an Enterprise Agreement), an embedded license is not required. For details on OEM licensing discounts and how licensing fees affect revenue sharing calculations, please contact your Microsoft Partner Development Manager (PDM) or the Biz Apps Enablement desk. *OEM – Original Equipment Manufacturer

Steps to access ISV Cloud Embed SKUs Review ISV Cloud Embed Requirements Solution Eligibility Criteria Join ISV Connect Become a CSP Partner Questions? ISV Connect: bizapps. ISVprogram@microsoft. com ; www. aka. ms/bizapps. ISVweb ISV Cloud Embed: isv_ce@microsoft. com Microsoft ISV Cloud Embed Program Handbook Apply for ISV Cloud Embed Access Cloud Embedded SKUs via CSP portal

Solution Eligibility Criteria To be eligible for inclusion in the ISV Cloud Embed Program, a prospective ISV solution must meet the following eligibility criteria: The ISV’s software applications and scripts (and third-party software applications, if applicable) included in the proposed Embedded Unified Solution (“ISV Portion” of the prospective ISV solution) must run natively (be designed to run on) on any Embedded edition of a Product If the prospective Embedded Unified Solution is to include more than one Embedded edition of the Product, the ISV Portion must run natively on each of the intended Embedded edition of the Products. The ISV Portion must be integrated with the Embedded edition of the Products such that the prospective ISV solution can only be distributed and licensed by including the Embedded Edition of the Products together with the ISV Portion (i. e. , the Embedded edition of the Product cannot be distributed on a standalone basis. ) A prospective ISV solution that is built on an Embedded edition of a Dynamics 365 Product must be specifically designed for and marketed to a vertical industry. The ISV Portion must be listed on Microsoft App. Source and meet the guidelines available at https: //appsource. microsoft. com/en-us/partners

The ISV Connect Program To be eligible for inclusion in the ISV Cloud Embed Program, a prospective ISV must be enrolled in the Microsoft Business Applications ISV Program Grow your business building apps customers love • New ISV program based on revenue sharing – two tiers 10% and 20% • Impacts all Customer Engagement, Finance & Operations and Power. Apps solutions (Business Central, Power BI are out of scope for now) • Learn about the program and view resources available to Business Applications ISVs by visiting the website (http: //aka. ms/Biz. Apps. ISVWeb) • Read the program guide A platform built for you Smart Azure connections Sales and marketing support • Extend 1 st party Dynamics 365 applications • Build directly on CDS using Power. Apps • Connect your existing apps to the platform • Use low/no code UI frameworks and logic • Integrate intelligent services with your app • Leverage native data stores for faster performance • Get insights about how customers use your app • Boost customer confidence with security from Azure • Find leads with improved App. Source features • Apply for discounts for embedding OEM licenses* • Receive phased go-to-market (GTM) benefits • Win deals thru Microsoft cosell opportunities * (http: //aka. ms/Biz. Apps. ISVProgram) *pending Microsoft approval, subject to terms and agreement

CSP Direct To be eligible for inclusion in the ISV Cloud Embed Program, a prospective ISV must be enrolled in CSP Direct Own end-to-end customer relationship CSP model for ISV Cloud Embed is “Direct Partner”. Under this model ISVs will need to: Package their IP with Microsoft cloud and Resell Have investments and resources to commit and support customers Offer technical support, billing management, credit facilities, and business services to the customers To leverage ISV Cloud Embed offer, Partner must sign up to become a CSP Direct Partner Learn about the CSP Program HERE Enroll in the CSP Program HERE

Apply for ISV Cloud Embed If a prospective ISV and their solution meet all the requirements and eligibility criteria above, they may apply for ISV Cloud Embed To apply for ISV Cloud Embed, ISV must complete the ISV Cloud Embed Application for each app they want to sell as an embedded unified solution - one webform per app Upon Microsoft’s review and approval, gain access to Cloud Embedded SKUs.

Access ISV Cloud Embed SKUs Upon solution approval for ISV Cloud Embed, ISV is granted access to ISV Cloud Embed SKUs and can sell those with their approved solution *Pricing information is shared strictly under NDA and can be requested from partner’s Microsoft Partner Development Manager (PDM) Effective August 1, 2020 Offer Name Common Data Service Database Capacity ISV embedded Dynamics 365 Business Central Device embedded (36 mo) Dynamics 365 Business Central Essentials embedded (36 mo) Dynamics 365 Business Central Premium embedded (36 mo) Dynamics 365 Business Central Team Members embedded (36 mo) Dynamics 365 Commerce embedded (36 mo) Dynamics 365 Customer Service Enterprise embedded (36 mo) Dynamics 365 Field Service embedded (36 mo) Dynamics 365 Finance embedded (36 mo) Price (USD) user/month Base √ √ √ √ √ Base Attach Student Faculty Effective August 1, 2020 Offer Name Dynamics 365 Human Resources embedded (36 mo) Dynamics 365 Human Resources Self Service embedded √ √ √ √ √ √ √ √ Dynamics 365 Unified Operations - Database Capacity embedded Power Apps per app plan embedded Dynamics 365 Human Resources Self Service embedded (36 mo) Dynamics 365 Marketing embedded (36 mo) Dynamics 365 Operations - Activity embedded (36 mo) Dynamics 365 Operations - Device embedded (36 mo) Dynamics 365 Sales Enterprise embedded (36 mo) Dynamics 365 Supply Chain Management embedded (36 mo) Dynamics 365 Team Members embedded (36 mo) Price (USD) user/month Base Attach Base Student Faculty Base Attach √ √ √ √ √ Attach Faculty √ √ √

Sales Scenarios with ISVs 1 Customer Tenant EA scenario: Customer buys Dynamics 365/Power. Apps on EA Side load Microsoft VL 2 CSP scenario: Customer buys Dynamics 365/Power. Apps via a CSP partner Partner 3 Embed scenario: Customer buys Dynamics 365/Power. Apps via Cloud Embed (CSP) Customer Tenant ISV Dynamics Instance Side load Microsoft CSP ISV App Dynamics Customer Tenant ISV Dynamics Instance Side load Dynamics © Microsoft Corporation ISV Dynamics Instance Microsoft CSP Dynamics 365 ISV App

Program revenue sharing examples (Build, Extend, Connect) Without OEM Contoso Software Annual price Scenario (10% or 20%) Revenue sharing fees MSFT revenue sharing fee via ISV Connect Program Contoso Attendance 100, 000 Standard tier (10%) $10, 000 10% of $100 K + 20% of $1, 800 K = $370 K Contoso Materials 1, 800, 000 Premium tier (20%) $360, 000 Annual price Scenario (10% or 20%) Revenue sharing fees MSFT revenue sharing fee via ISV Connect Program Contoso Attendance OEM Unified Solution 100, 000 Standard tier (10%) $10, 000 10% of ($100 K- Embed paid to Microsoft) + 20% of ($1, 800 K- Embed paid to Microsoft) = $370 K - Embed paid to Microsoft Contoso Materials OEM Unified Solution 1, 800, 000 Premium tier 20%) $270, 000 Dynamics OEM pricing integrated into Contoso Software Embed pricing NA NA Note: ISV Cloud Embed requires ISV to sell both the IP and the OEM licenses at a single price point. When reporting the deal to Microsoft, the OEM license portion paid to Microsoft via CSP should be subtracted With OEM Contoso Software