Microsoft Dynamics 365 licensing changes effective October 1, 2019
With the introduction of Mixed Reality and AI products and the recent changes to the licensing structure, Microsoft is encouraging customers to customize their own licensing. Microsoft Dynamics 365 has moved from a plan-based licensing model to an app-based licensing model.
Buy what you need
Earlier, customers had the choice of purchasing the Microsoft Dynamics 365 plan, Customer Engagement plan, and the Unified Operations plan. Not only have the plans been removed from price lists, but the Unified Operations plan has been split into two individual applications – Finance and Supply Chain Management (SCM). This new approach allows customers to evaluate their business requirements, define their needs, and only purchase the apps that they specifically require.
The Microsoft Dynamics 365 SKU placemat below shows the changes effective from October 1, 2019
These subscription licenses are divided into two types of users – Full Users and Additional Users.
The base and attach licenses are referred to as Full Users, whose work requires the use of feature-rich business applications functionality and are licensed with a Microsoft Dynamics 365 application subscription accordingly.
Team Members and Activity Licenses are Additional Users who often represent a large percentage of users in an organization and may consume data or reports from line of business systems, complete light tasks like time or expense entry and HR record updates, or be heavier users of the system, but may not require Full User capabilities.
Device License is also an Additional User. With Device SL, any number of users can access a licensed device with individual logins without the need for separate User SLs. If individual users share one login, their individual usage cannot be tracked.
Core business applications
The core business applications can be purchased as either a base or as attach license(s), although there are some restrictions:
- A Full User must have one base license at least and might require additional base licenses where the app is not available as an attach license.
- A base license can have more than one attach license per user.
- Base license is available at the standard price and attach license is available at a reduced price. Base and attach licenses are identical in their core capabilities but vary in price.
- With multiple business applications, the base license must be the higher priced license. Each user must have one base license.
- Each attach license can only be assigned to a user with a qualified base license. Admin will not be able to assign the attach license to a base license if a user does not have the required base license.
PSA and Talent licenses
- If a PSA customer requires many Customer Engagement applications, they can buy PSA as their base license and further purchase additional Customer Engagement applications (Sales, Customer Service, Field Service) at the attach price.
- For users seeking PSA license and one of Finance, Supply Chain Management, or Retail licenses, they will have to purchase both as a base license at the standard price.
- Talent is not available as an attach license and there are no options to purchase attach licenses for Talent users. Talent needs to be purchased as a standalone base license only.
- Additional applications, capacity, or non-core business applications do not qualify for the multi-application base/ attach motion but may be purchased as individual licenses.
Under EA licensing, if an attach license is purchased when a base license is required, customers may step-up the attach license to the appropriate base license. In CSP and MPSA, customers need to return the attach license and purchase the appropriate base license.
The current changes to the licensing model will not only affect current organizations with a Microsoft Dynamics 365 subscription but will also impact the ones that are planning to transact licenses in the future.
About the Author
An experienced marketing professional, currently working for a Microsoft Dynamics 365 partner. My role entails not only managing the Microsoft Partner Program solely, but also taking care of marketing efforts around the program and the organisation. I have 12 years of marketing experience in the IT Services space.