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Microsoft to Rejig its Plan-Based Licensing and Pricing Model for Microsoft Dynamics 365

Microsoft announced its decision to end the plan-based licensing for Microsoft Dynamics 365 by September 30, 2019. The announcement was made at its annual event - Microsoft Inspire 2019 - held last week.

The new pricing model comes into effect from October 1, 2019. Existing customers will be moved to the new pricing model for renewals in the fiscal year 2020, with additional incentives for CSPs selling over 100 seats.

According to a Microsoft official, it is observed that close to 80% of the Microsoft Dynamics 365 Customer Engagement users use a single app and the existing “Plans” are not delivering the value message. The official expressed that the “Plans” persuade customers to discuss pricing but not the actual value it offers. Also, when customers pay for capabilities that they do not require, there is an adverse impact on the perception of value.

Plan-Based Licensing and Pricing Model for Microsoft Dynamics 365

Currently, Microsoft offers the Customer Engagement Plan (CRM) for $115 per user per month; Unified Operations Plan (ERP) for $190 per user per month; and the Microsoft Dynamics 365 Plan (ERP and CRM) for $210 per user per month.

In the future, Microsoft Dynamics Customer Engagement will be sold as a base license with “attach licenses” that will be sold only if needed and would be heavily discounted. According to a slide from a Microsoft presentation tweeted by Microsoft Dynamics 365 Customer Engagement trainer and professional, Tommi Oksanen, the current $115 per user per month would be replaced by a base price of $95 per user per month, plus an attach license price of $20 per user per month, if needed. Microsoft strongly believes that this will encourage customers to purchase applications based on their individual user needs.

From the presentation, it was also noted that the Project Service Automation app will be available as a base app (for $95) and not as an attach app.

To learn more about the current pricing models and how the new pricing models would impact your business, contact us.

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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