VOP SE 2022 - Mod2 - QRG

Module 2: Quote (VOP-SE)
Module 2 provides a guide for enabling the subscription business, information on currency settings, how
Customers can drive savings, and a review of the quoting process.
I. Subscription Service Portal
VMware has invested in new subscription portals. Specific to partners, the Cloud Partner Navigator
(CPN) that may be accessed from Partner Connect helps you manage and transact your subscription
instances. A variety of critical functions are contained in this portal: viewing customer details, viewing
open and closed orders, viewing subscription renewal statuses, managing notifications and price lists,
and accessing the configurator. Below you will see the different Partner Contacts Eligibility & Role
assignment for CPN
II. Currency Requirements
2022 VOP-SE: Module 2: Quote

For the Confidential use of VMware Partner Connect members only with the VMware Partner Connect Subscription Services Portal
Copyright © VMware Inc. all rights reserved. VMware, Inc. 3401 Hillview Avenue, Palo Alto, CA 94304 USA www.vmware.com
For more information: partnerconnect@vmware.com
III. Pricing Customization Options
Pricing Options WITH
Pricing Options with NO functionality implications
functionality implications
Quantity Tier ▪ Unit price discounts by purchasing larger quantities

Core or Initial Service ▪ Applies to various term lengths and payment types
Configuration ▪ Per service ID – Doesn’t accumulate across SIDs
▪ Doesn’t apply to all services; check pricelist for availability
Add-Ons
Payment type ▪ Discounts by pre-paying vs monthly or annual payments
▪ Metered items will be invoiced monthly
▪ No credits given to invoices due to price changes
▪ Prepaid: No early termination
▪ Monthly and annual options support early termination
Term Length ▪ Bigger discount by selecting longer terms (applies to many Service
Offerings, but not all of them)
IV. Alternate Quoting/Buying Vehicles
Special Pricing Form (SPF) Enterprise License Agreement (ELA)

Process and form for requesting a special pricing Provide customer-focused incremental discount
exception through strategic VMware Partners
▪ Can be used on multiple cores if part of an initial ▪ Can combine ELA subscription and license
provisioning request or renewal products
▪ Expires at the end of the subscription term ▪ Prepaid Subscription SKUs only
▪ No auto-renewal, only in exceptional cases and ▪ 12, 24 and 36 month terms only
upon authorization ▪ Excludes metered charges (monthly invoices)
▪ Apply to all SKUs and all add-ons for the initial ▪ Immediate invoicing upon booking
order ▪ For auto-renewals, MSRP costs would apply
▪ All SKUs on SPF must have the same term ▪ 1 year auto-renew regardless of previous term
▪ Must include SPF number on initial order length
▪ Does not apply to metered items
The VMware Cloud Provider Program

Enables Cloud Partners to offer Subscription Services expanding the Partner Ecosystem with the
introduction of two roles: Service Providers and Aggregators
▪ Managed Services Model has been designed in which VMware delegates all the billing and
support processes to the Service Provider. For VMware, the End Customer is the Service
Provider
▪ Service Providers must operate a Data Center delivering as-a-service to their customers to
become part of this program
▪ Support and onboarding activities for End Customers are done by the Service Provider
▪ Service credits and 1st month off promotions are not applicable within this VMware Cloud
Provider Program
▪ Partners transacting in the subscription world can also be part of the VMware Cloud Provider
Program - Multi-role partners:
− Distributor and Aggregator
− Solution Provider and Service Provider or Aggregator (not standard)

Advantage Plus (Ad+) Opportunity Registration Program
Extends existing Advantage+ benefits to subscription services for the initial term of subscriptions
▪ Upfront Discounts are applied to the resulting transaction for approved registrations.
▪ Enterprise License Agreements (ELA), Special Pricing Forms (SPF) and vCAN contracts do not
apply for Ad+ discounts
▪ Minimum Opportunity size: $6,000 USD TCV (Total Contract Value) list product value: licenses,
subscriptions and credits program combination
▪ Discount is approved to only one Reseller per deal (with our tracking #, ORAN)
▪ Ad+ discount works on a “One ORAN - One Order” basis. One single ORAN can support license
and subscription product combination
▪ Add-ons will receive the discount until the end of the SID term length.
▪ Renewals will not receive the Ad+ discount benefits
▪ SPP Credit purchases received the Ad+ discount at the time of the credit purchase and will not
apply to the redemption
V. Supporting Commercial Terms through MSAs and Open POs

Because of the unique conditions of the subscription services model, we strongly recommend that Master Service
Agreements (or MSA) or Open Purchase Orders (or POs) are used in your transactions. If you do not have existing
methods to enforce commercial terms, MSAs or POs should be considered due to their flexibility.
▪ PO that supports invoicing different than what was represented on the initial PO/SO
▪ Transaction specific (e.g., specific SKU)
Master Service Agreements Open Purchase Order
▪ Contract that spells out most terms between
What? ▪
signing parties
Purpose: speed up any future contracts
▪ Allows multiple chargeable occurrences

Why? ▪ Helps facilitates use of Self-Service Add-Ons
▪ Include subscription terms

How? ▪
▪
Highlight monthly billing implications
VMware recommends Buyer Signature and PO but no fixed price
VI. Quoting Process

Basics ▪ Work with your Distributors to ensure you have the latest pricing
▪ Review VMware’s Subscription Terms of Service to structure Commercial Terms
accordingly
▪ Use the Configurator to determine which SKU’s to quote (available through Partner
Central)
▪ Quote will be valid until quote expiry date
▪ Continually review credit worthiness and work with Customers to ensure they can
meet all billing obligations
Considerations Initial Order

▪ Quotes may be generated for: Initial Orders,
Add-On Orders, Renewal Orders
▪ Invoice contains quoted items but there may be Core or Initial SKU
additional pro-rated/co-termed charges or
metered items which will cause the invoice to Billing Choice
exceed the quote value - Your commercial terms
should account for this Service Length
▪ Quote does not include: un-orderable, metered Any Add-Ons the

items (e.g. Microsoft OS licenses) customer decides to
include
VII. Special Pricing Form (SPF)

One of the alternate quoting/buying vehicles is the Special Pricing Form or SPF. SPF is the process and form for
requesting a special pricing exception approval.
SPF Quoting Policies
SPF can be used on multiple cores as part All add-on products will receive the same
of an initial provisioning request or
discount as the core.
renewal.
Customers cannot change the All SKUs on SPF must have the same term.
discount rate mid-term to an SPF.
SPFs cannot combine with other
The SPF expires when the subscription promotions (exception: a free first month
term finishes. SPF will NOT auto-renew promo as an example).
and must be renegotiated. (In exceptional
cases, SPF will auto-renew upon
authorization.) You MUST include SPF number on the
initial provisioning order.
SPF discounts apply to all SKUs and
product families. SPF discounts do not apply to usage/metered items.
Prepaid SKUs are an alternative to SPFs to drive down costs for the customer and avoid potential SPF process delays.

To explain SPF further, SPF refers to the process whereby a special price exception approval is requested by
submitting a particular form. Although it is a standard business process applicable to subscription purchases as
well as licensed products, certain unique conditions apply to subscription products.
As you work with your customer to determine configuration factors such as payment option, term length,
location, and type, your SPF details will include ALL SKUs that match this set of filters. Your SPF submission must
include ALL SKUs that are relevant add-on items for this purchase.
SPF provides discounts on recurring orders for selected SKUs based on previously negotiated discount rates.
SPF may be applied to multiple cores, only if all of those cores are included within the same initial provisioning
request or renewal. In the middle of a term, a customer cannot change the discount rate.
The SPF expires at the same time the subscription term finishes. If a subscription order is set to auto-renew, it
DOES NOT mean the associated SPF will auto-renew as well. They work independently. If the customer needs to
renew at the same SPF discount, the SPF needs to be renegotiated. This is something that is reinforced in the
renewal reminder notice that customers receive prior to the end of their subscription term. However, in
exceptional cases, SPF will auto-renew upon authorization.
SPF discounts apply to any SKUs included in a future add-on order within the SPF term length. It is important to
consider that all SKUs subject to SPF discounts must have exactly the same term.
Usually, SPF discounts cannot be combined with other promotions. However, exceptions can be made, such as in
the example of a first month free promo.
The SPF quote number MUST BE included on the initial provisioning order.
Metered/usage items do not receive SPF discounting.
Please note that prepaid SKUs are an alternative to SPFs to drive down costs for the customer and avoid potential
SPF processing delays.
VIII. SPF Auto-Renewal: As Special Exception
Standard SPF policies apply.
The duration of the SPF auto-renewal should be specified by the number of terms (not months)
beyond the first term.
At the end of the SPF auto-renewal duration, SPF auto-renewal expires and needs to be
renegotiated.
SPF auto-renewal will also expire if customer doesn’t renew or cancel the service.
If a manual renewal order is received with a change in the core configuration, the SPF auto-renewal will
expire.

To explain the auto-renewal process further, SPF auto-renewals do not replace the existing non auto-renewing
SPF. VMware will allow automatic renewal of SPF at the time of the service instance renewal in exceptional cases
upon authorization, especially for services with non-standard term lengths.
It is important to highlight that standard SPF policies apply, but some special considerations need to be kept in
mind. The duration of the SPF auto-renewal should be specified by the number of terms (not months) beyond the
first term.
SPF auto-renewal will expire and need to be renegotiated:
• At the end of the auto-renewal duration,

• If the customer doesn’t renew or cancels the service,
• Or if a manual renewal order is sent with changes in the core configuration.
Note that customer will receive notifications for the remaining terms of the SPF auto-renewal and at the end of
the cycle to remind them that the SPF will no longer be renewed.
IX. Enterprise License Agreement (ELA)

The second alternate quoting/buying vehicle is the Enterprise License Agreement (ELA). ELA provides customer-
focused incremental discounts through strategic VMware Partners.
ELA Details
Can combine ELA subscription and licensed products, end

Combination of Services dates may vary (license vs. subscriptions)
• Prepaid subscriptions only

Payment Term • 12, 24, and 36-month terms only
• Summary agreement pricing includes everything except
metered charges
• Immediate invoicing upon booking; no waiting for

Invoicing provisioning completion
• May have monthly invoices for variable or metered use
• For auto-renewals, Manufacturer Suggested Retail Price

Renewals (MSRP) costs would apply
• One year auto-renew term regardless of previous term
length
To explain ELA in a more detailed way, Subscription Services can be offered as part of an Enterprise License
Agreement or ELA as a way to obtain pricing discounts. ELAs provide customer-focused incremental discounts
through strategic VMware Partners. However, this offering is subject to unique rules and has a slightly different
quote-to-cash process.
First, an ELA can combine both perpetual licenses and Subscription Services, and these can have varying end
dates. As such, the licenses do not need to be perfectly aligned with the subscription, which is subject to a
provisioning service level agreement that is different from perpetual licenses.

Next, Subscription Services sold in an ELA must use a prepaid SKU, as opposed to a monthly or annual-billed
SKUs. The minimum term of the SKU must be 12 months. Only 12, 24, and 36-month terms are allowed. As usual,
there may be monthly bills for metered items.
Let’s move on to invoicing. Unlike the normal subscription quote-to-cash model, invoicing in the ELA model does
not wait for the provisioning of the service. Instead, invoicing is immediate upon order booking, so it can be
combined with the invoicing for all the perpetual elements of the ELA. Again, please note that this does not
preclude the service from incurring monthly bills for metered items.
Renewals also have unique rules. Subscription Services ordered through ELAs are still auto-renewed by default,
but unlike normal subscriptions, ELA subscriptions will auto-renew to a one-year term regardless of the initial
term length. It’s important to mention that when the service is automatically renewed, Manufacturer Suggested
Retail Price or MSRP costs are applicable.
Further ELA guidance will be provided on a case-by-case basis, as these deals are negotiated.
X. High-Level Quote-to-Cash Process Flow – ELA

The visual below depicts a high-level ELA quote-to-cash process flow between a customer, reseller, distributor,
and VMware.
Occurs Anytime Occurs Monthly

Customer Start End
Identify Agree to Provide Billing Use Submit
Desired Subscription / Tracking Subscription Payment to
Services Commitment Number (PO#) Service Reseller
Reseller
Create Quote Issue
Request and Submit ELA Invoice to
Quote Commercial Order Customer
Terms
Distributor
Create Issue Issue

Submit ELA Order Monthly PO Invoice to
Quote to VMware Reseller
VMWare
Produce
Track Proforma Issue
Book Order Provision Customer Invoice to
Subscription Invoice to
Use Distributor Distributor
The ELA flow is different from the regular subscription quote-to-cash flow in a few specific areas.
First, the VMware field organization is always directly involved in ELA transactions. Once the ELA is finalized,
instead of submitting a provisioning request, the distributor submits an order to VMware. This is because all items
in the ELA, including the subscription elements, are prepaid and invoiced immediately upon order booking. In the
standard non-ELA model, invoicing does not begin until provisioning, which is based on a provisioning request
from a distributor.
Second, invoicing is immediate upon order booking. Again, please take note that invoicing may still occur during
any billing cycle for metered items.


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Module 2: Quote (VOP-SE)

II. Currency Requirements

2022 VOP-SE: Module 2: Quote

Quantity Tier ▪ Unit price discounts by purchasing larger quantities

IV. Alternate Quoting/Buying Vehicles

Special Pricing Form (SPF) Enterprise License Agreement (ELA)

The VMware Cloud Provider Program

2022 VOP-SE: Module 2: Quote

V. Supporting Commercial Terms through MSAs and Open POs

Master Service Agreements Open Purchase Order

▪ Contract that spells out most terms between

▪ Allows multiple chargeable occurrences

▪ Include subscription terms

VI. Quoting Process

2022 VOP-SE: Module 2: Quote

Considerations Initial Order

▪ Quote does not include: un-orderable, metered Any Add-Ons the

VII. Special Pricing Form (SPF)

SPF Quoting Policies

2022 VOP-SE: Module 2: Quote

Metered/usage items do not receive SPF discounting.

VIII. SPF Auto-Renewal: As Special Exception

Standard SPF policies apply.

2022 VOP-SE: Module 2: Quote

SPF auto-renewal will expire and need to be renegotiated:

• At the end of the auto-renewal duration,

IX. Enterprise License Agreement (ELA)

Can combine ELA subscription and licensed products, end

• Prepaid subscriptions only

• Immediate invoicing upon booking; no waiting for

• For auto-renewals, Manufacturer Suggested Retail Price

2022 VOP-SE: Module 2: Quote

X. High-Level Quote-to-Cash Process Flow – ELA

Occurs Anytime Occurs Monthly

Create Issue Issue

2022 VOP-SE: Module 2: Quote

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