• Microsoft Dynamics Services

An Update on Microsoft Dynamics 365 On-premises Licensing

Microsoft’s July 2017 service update brings the arrival of Dynamics 365 on-premises, which offers new capabilities and licensing options for customers. The Dynamics 365 on-premise solution provide purpose-built applications for managing specific business functions, which include Dynamics 365 for Sales (On-Premises), Dynamics 365 for Customer Service (On-Premises), Dynamics 365 for Field Service (On-premises) and Dynamics 365 for Finance and Operations (On-premises).

When deploying in an on-premises datacenter, Dynamics 365 can be licensed under the traditional Server + Client Access License (CAL) perpetual license model. This implies that you license the server(s) running the software, as well as the users and/or devices that access the solution.

Server and Client Access Licenses

The Microsoft Dynamics 365 (On-Premises) Server license for each application provides access to all of the capabilities offered within the application as delivered by Microsoft. There are not sub-modules within each application that need to be licensed. As such, the server licenses provide a rich set of features and also support multi-tenant deployments.

Server and Client Access Licenses
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Each user that needs to access a Dynamics 365 application (On-Premises) requires a Client Access License (CAL). There is no limit to the number of users that can be licensed or that can access the application, however depending on your number of users, you may require additional server capacity.

Internal User Access Licenses

Each internal user that requires access to the Microsoft Dynamics 365 (On-premises) server, files, data, or other functionality requires a CAL. Dynamics 365 on-premises, Enterprise edition, comes with two types of CALs:

  • User CALs: User CAL licenses are assigned on a ‘named user’ basis, which meansthat each user requires a separate CAL. The User CAL cannot be shared, however a single user accessing the Dynamics 365 applications from multiple devices is permitted without having the need for separate device CALs. It makes sense to purchase a User CAL for company employees who access the corporate network while on roaming using multiple devices.
  • Device CALs: Device CAL licenses are specific to a device, such as a handheld barcode scanner, a shared kiosk, or a POS system in the retail industry. These device licenses can be shared across users without requiring a separate CAL for each user. From an administrative and economic point of view, purchasing Device CAL makes more sense to those companies where employees share devices.

External User Access Licenses

Access for external or third-party users is by default included in the license. External users are defined as those who are not an employee, contractor, or agent of the customer providing business support on the customer’s behalf. Each of these user types generally require a CAL. However, Client Access Licenses (CALs) are not required for other types of external users.

External and Internal User Access Licenses
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Dual Use Rights

Dual use rights provide the option to deploy Microsoft Dynamic 365 in the cloud or in a private on-premises or partner-hosted cloud. In some cases, customers may want to use both the deployment options simultaneously, for example when migrating a Microsoft Dynamics 365 on-premises deployment to Microsoft Dynamics 365, or for running private Dev/Test deployments in Microsoft Azure. In this scenario, you can use Dynamics 365 User Subscription Licenses with a monthly subscription price, instead of a CAL.

Dynamics 365 On-premises License Types

Beyond the User vs. Device CAL concept, Dynamics 365 is licensed on a named user basis, with application use rights classified into two types:

Full Users are those who require the use of feature rich business app functionality. A good example of Full Users would be salespeople or customer service representatives, who would take the sales and/or customer service CAL.

Light Users are the large number of employees in an organization who may utilize data and or reports from line of business systems and who are engaged in light tasks like updating contact information or account information. Light users in Dynamics 365 On-premises are licensed with the Team Members license.

You can download the new licensing guide explaining the on-premises licensing options for the future. Please click here to download Licensing Guide.

As a leading Dynamics 365 implementation partner, SAGlobal can help suggest the best licensing option that suits your business needs. Please contact us for more details on the licensing model, transition processs, and features that are available within Dynamics 365.

About the Author

Dhananjayan Jagadeesh

Dhananjayan Jagadeesh

Dhananjayan K J is Senior Digital Marketing Manager for SAGlobal, where his role is to primarily develop and implement digital marketing strategies for Microsoft Dynamics products and services. Dhananjayan has over 12 years of enterprise marketing experience with strong background in digital marketing across industries.

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