What is Azure CSP? Benefits & Cost Savings Guide [2025]

When managing Azure environments, choosing the right procurement strategy is crucial. As Azure now holds nearly 24% of the global cloud market, organisations are keen to optimise their cloud spending without compromising performance. While purchasing directly from Microsoft is certainly an option, many are finding that the Azure CSP (Cloud Solution Provider) program provides a superior combination of flexibility, expert guidance, and cost management.

Recent market changes, including Microsoft’s pricing updates effective from 2025 which impose an extra charge for monthly billing on annual contracts, have made the role of a strategic partner all the more significant. A knowledgeable CSP can help you navigate these complexities, unlocking substantial savings and operational efficiencies that might be difficult to achieve through direct purchases. For many, partnering with a CSP offers a pathway to maximise returns on their Azure investment.

This guide will explore what the Azure CSP program entails and how it compares to other purchasing avenues. We’ll also outline practical cost optimisation strategies tailored for CSPs and guide you through the process of selecting the right partner, all aimed at elevating the value of your Azure investments.

What is Azure CSP?

The Microsoft CSP program essentially enables certified Microsoft partners to sell and manage the entire range of Microsoft cloud services, including Azure, Microsoft 365, and Dynamics 365, directly to customers.

The primary distinction from traditional direct purchase methods is that the CSP takes ownership of the entire customer lifecycle. This means they handle provisioning, billing, and provide first-line support, creating a single point of accountability for your organisation.

Source: Azure CSP Hierarchy

So, why should you consider an Azure CSP over direct purchasing?

Three key benefits often emerge: expertise, simplicity, and added value.

A proficient CSP transcends the role of a typical reseller; they become your strategic cloud advisor, melding Microsoft’s robust technology with bespoke managed services, specialised support, and industry-specific solutions. This integrated approach alleviates uncertainty and streamlines your operations, consolidating all cloud needs—licensing, billing, and advanced support—into a single predictable monthly invoice.

To facilitate this, the Azure CSP program is categorised into two vendor models:

• Direct (Tier 1) CSPs: These partners purchase services directly from Microsoft and are equipped to manage billing and support at scale, having met rigorous revenue and support criteria.
• Indirect (Tier 2) CSPs: Often termed resellers, these partners collaborate with a Direct CSP (or distributor), allowing a broader range of IT providers to offer Microsoft cloud solutions. This expanded network ensures that businesses, regardless of size, can access partner-driven Azure expertise and support.

Azure CSP vs. Direct Purchase: An In-Depth Comparison

Determining how to acquire your Azure services is a strategic choice, extending beyond mere pricing. This decision impacts support experiences, administrative duties, and overall flexibility. The primary alternatives to CSPs are direct purchasing options such as Pay-As-You-Go (PAYG), suitable for newcomers, or Enterprise Agreements (EA) designed for larger organisations with forecastable, high-volume cloud expenditures.

For many businesses that don’t fit the strictures of an EA, the decision often hinges on CSP vs PAYG. While PAYG offers straightforwardness, a CSP provides a more holistic and value-driven partnership. Let’s examine practical scenarios and differences between these models to help identify which best suits your organisation’s unique requirements.

Cost Structure and Pricing Models

The most apparent difference is how you pay for your Azure services. With PAYG, you pay Microsoft’s standard list price for resources consumed, billed monthly to your credit card. Though this method is simple, it can become costly and unpredictable as you scale and your computing needs fluctuate.

There are no in-built discounts or cost management features with PAYG. An EA does offer volume discounts but locks you into a rigid three-year commitment with a hefty upfront payment.

The CSP model introduces a more flexible pricing approach, where the partner sets the prices—often reflecting discounts from Microsoft’s partner incentives. Billing can be tailored to monthly or annual cycles, simplified into a single, comprehensible invoice. This predictability is a noteworthy advantage.

Startups typically find that CSPs can provide better pricing than PAYG while also offering essential architectural and support guidance. For mid-sized organisations, CSPs can facilitate significant cost optimisation through services like Reserved Instance management, a task that would otherwise be complex and time-consuming.

Support and Service Levels

With a direct purchase model, your organisation relies solely on Microsoft’s standard support channels. The basic support offered generally includes just billing and subscription queries; any technical help necessitates a separate (often costly) support plan.

While Microsoft agents handle issues adequately, it can be impersonal and cumbersome. You become just another ticket in a queue, dealt with by engineers who lack context regarding your specific environment or business objectives.

In contrast, a CSP serves as your initial support point, gaining familiarity with your architecture, applications, and business goals. When issues arise, you won’t need to start from scratch explaining your setup. The personal and informed support typically results in quicker and more satisfactory resolutions, alongside strategic and forward-thinking advice.

A proficient CSP can also access higher support tiers within Microsoft, enabling them to escalate issues on your behalf more efficiently.

Billing and Administrative Overhead

Anyone relying on PAYG or EA models is well aware of the complexity often associated with Azure invoices. These documents can be cluttered with countless services and potentially thousands of line items, making it arduous for finance and IT teams to decipher and budget accordingly.

A CSP simplifies this process by reconciling Microsoft’s detailed invoices and providing a clear, single document, significantly lowering the administrative burden. Rather than spending days trying to navigate usage meters and SKUs, your team receives a straightforward and predictable bill from a reliable vendor—allowing them to concentrate on strategic initiatives.

Control and Flexibility Trade-offs

When adopting a direct PAYG or EA model, your organisation retains sole administrative authority over its Azure environment. By partnering with a CSP, however, you may need to delegate some administrative rights (often using frameworks like Admin on Behalf Of or GDAP), enabling them to manage your environment. While this may seem like a loss of control, it’s often a strategic choice worthy of consideration.

Think of it as delegating management tasks to a trusted expert. This allows for proactive monitoring, continual cost optimisation, and expert support.

The CSP model offers considerable flexibility in scaling services and licenses as your needs evolve—a challenge often faced with an EA. For many organisations, the benefits from expert management outweigh the perceived drawbacks of relinquishing hands-on control.

Azure CSP Cost Optimisation Strategies

Partnering with a CSP can unlock savings that go beyond mere discounted rates. While anyone can utilise Azure’s cost-saving tools, a CSP offers proactive management and expertise, shifting optimisation from a sporadic task to an ongoing, managed process.

Source: Azure Cost Management

This is the primary distinction: with a direct payment model, you gain access to the tools. In contrast, a CSP actively employs the tools on your behalf.

A competent CSP will implement a multifaceted strategy to manage your cloud expenses—something challenging to achieve without a dedicated in-house FinOps team. Some approaches they may use include:

• Partner-Earned Credits and Discounts: Microsoft provides a Partner-Earned Credit (PEC) to CSPs for overseeing Azure services, incentivising partners to manage their customers’ Azure environments effectively. Many CSPs share a portion of these savings, resulting in more attractive pricing compared to PAYG.
• Strategic Reserved Instances: Azure Reservations and Savings Plans can cut costs by up to 72% for predictable workloads, although they can be complex to navigate. An adept CSP will assess your usage patterns to recommend appropriate reservations, handle purchases and renewals, and continuously assess usage to ensure you maximise your investment.
• Waste Elimination through Automation: CSPs can set up automated protocols to shut down non-essential resources during off-hours or continuously resize over-provisioned VMs and storage based on actual consumption instead of paying for idle resources.
• Bundled Services: Since the Azure infrastructure remains constant, CSPs distinguish themselves by the added services they offer alongside the technology. This may entail proactive security audits, performance monitoring, or cost governance reports being included in their standard offerings, providing expert oversight that preempts issues and cost overruns.

Ultimately, the CSP model integrates these strategies into a routine of continuous optimisation. A strong partner does not merely help you reduce costs initially; they establish a governance framework that keeps your spending efficient over time. This proactive, managed handling contrasts starkly with the often reactive, do-it-yourself nature of cost management associated with direct purchases.

Selecting the Right Azure CSP

Deciding to partner with a CSP is a significant strategic move, and your choice of partner is equally vital.

The ideal provider functions as an extension of your team, proactively managing your environment and delivering value. Conversely, the wrong choice could turn into just another vendor relationship that complicates your progress.

Source: Azure CSPs

Assessing potential CSPs requires looking beyond their sales pitches. Evaluating their skill sets, support frameworks, and general approach is essential. Seek a partner that aligns with your technical needs, business objectives, and company culture.

Qualifications and Certifications

Start by identifying objective indicators of a CSP’s expertise. Microsoft’s partner designations serve as a reliable foundation. For instance, the Azure Expert Managed Services Provider (MSP) designation is particularly esteemed, necessitating a stringent third-party audit validating their technical aptitude, customer success, and capability to manage complex Azure environments effectively.

It’s also vital to understand whether a partner is a Direct (Tier 1) or Indirect (Tier 2) CSP.

Direct CSPs maintain a direct billing and support relationship with Microsoft, often leading to quicker escalation paths and robust internal systems. Indirect CSPs operate through a distributor, adding additional layers to support and billing processes. Typically, a Direct CSP can offer a more streamlined experience for organisations with complex needs.

Technical Expertise and Support

Upon verifying a partner’s qualifications, delve into their practical capabilities. Pose specific operational inquiries to assess the depth of their expertise and the quality of their support.

A solid CSP should confidently explain Service Level Agreements (SLAs) regarding response and resolution times, whether they offer 24/7 support with experienced professionals, if you will have a dedicated account manager, and what process they follow for escalating urgent issues to Microsoft. Essentially, inquire about what you can expect should a critical production problem arise in the middle of the night.

Integration Capabilities

Evaluate how your CSP will integrate with your existing workflows and tools.

A modern DevOps team relies on specific technologies for CI/CD, monitoring, and security. A valuable partner will adapt to your environment rather than pushing you into their methodologies. A CSP that aligns with your preferred tools—be it Azure DevOps, Jenkins, Datadog, or other platforms—minimises friction and supports you in maintaining or enhancing your operational velocity.

Best Practices for Onboarding

Once you’ve selected a CSP, lay the groundwork for a constructive partnership from the very beginning. An effective onboarding process includes establishing clear communication channels (such as a shared Teams channel), defining roles and responsibilities for both your organisation and the CSP, and scheduling regular check-in meetings.

The effort invested in the initial onboarding stages will foster a collaborative relationship, ensuring your partnership extends beyond just another vendor agreement.

Maximising Azure CSP Value Through Advanced Cost Management

In summary, the Azure CSP model offers a robust framework for navigating your cloud services, evolving from a basic transactional relationship into a strategic partnership. By emphasising flexibility, leveraging expert support, and carefully selecting the right partner, you can enhance the efficiency and effectiveness of your Azure investment.

A CSP delivers a managed and proactive approach to your cloud environment, transforming cost optimisation from a sporadic task into a continuous, expert-directed process. This enables your team to reallocate focus towards innovation, instead of being bogged down by the monotonous details of cloud administration.

However, as your organisation scales, managing costs across various subscriptions and tenants can become increasingly challenging. While native tools like Azure Cost Management are solid starting points, they often fall short in intricate environments.

Native tools usually do not provide a consolidated view of costs across multiple subscriptions simultaneously, imposing the need for teams to manually switch contexts and aggregate data. Coupled with potential refresh delays of up to 24 hours, obtaining a comprehensive and real-time understanding of expenditure becomes challenging.

This is where a dedicated cost management platform becomes vital for any serious Azure user.

For organisations requiring deeper visibility and enhanced automation, Turbo360 offers an advanced Azure cost management solution purpose-built to tackle these complexities and more. Unlike native tools, Turbo360 is specifically designed for environments with multiple subscriptions and tenants, offering a single view that eliminates data silos. Recognising this common challenge, we’ve even developed a guide on exploring Azure costs across multiple subscriptions.

With Turbo360, transition from reactive cost analysis to proactive cost control. The platform enables you to automate the decommissioning of idle resources and schedule start/stop times for non-production resources. Its detailed cost analysis tools and advanced anomaly detection assist you in scrutinising expenditures and pinpointing exactly where your budget is allocated. Our aim is to detect unexpected spending spikes before they escalate into major issues.

By pairing the strategic benefits of Azure CSP with a powerful cost management platform like Turbo360, you can not only start with foresight but also ensure that you continually refine and enhance your cloud ROI as your organisation grows. Begin your 15-day free trial here.