Azure IP co-sell transitions from PRACR to Marketplace-first model in FY27
Why this matters: Removes an existing co-sell revenue reporting mechanism, directly affecting partner co-sell eligibility and deal economics.
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Microsoft is restructuring Azure IP co-sell in FY27 by shifting away from the Partner Reported Azure Consumed Revenue (PRACR) model to a Marketplace-first approach. PRACR will no longer function as a broad co-sell mechanism under the new model. Partners relying on PRACR for co-sell eligibility and revenue recognition will need to transition their go-to-market motion toward the Azure Marketplace.
What changed
- PRACR is being retired as a broad Azure IP co-sell mechanism in FY27.
- Azure IP co-sell moves to a Marketplace-first model, requiring transactable Marketplace offers.
- Partners with IP Co-Sell Eligible status will need to align their co-sell motions to the new framework.
- The transition affects how Azure consumed revenue is reported and credited for co-sell purposes.
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