At Microsoft Inspire, their annual conference, changes to Dynamics 365 and Dynamics 365 licenses were announced. Here we’ll give you a high level overview of the licensing changes and the new model which will be introduced from 1 October 2019.

Current licensing

This is a diagram of the existing landscape (pre October 2019) and product line-up to highlight how the combination of plans and the application components can be currently purchased, along with licenses for additional users and devices.

  • The Customer Engagement Plan (Back-Office) providing access to all the supporting applications for a customer relationship scenario.
  • The Unified Operations Plan. (Front Office) providing access to all the supporting applications for an Enterprise Resource Planning scenario.
  • The Dynamics 365 Plan covering both above plans and providing full access to all applications.
  • The individual Applications & Team Members licenses added as needed and without the need to purchase a supporting plan.

Customers currently license their requirements by selecting the plans or individual applications they need, with the plan licenses being more cost effective if access to two or more of the application licenses are required.

Following a review of their Dynamics customer base, Microsoft established that group of users weren’t using the whole functionality of the plans, utilising just a single application.  To address this, the new Dynamics 365 licensing model changes that are being introduced will be more efficient and show better return on investment.

What’s new for Dynamics 365?

From 1 October 2019 there will be changes to Unified Operations with the Finance and Operations module which is being split into two separate modules: Finance and Supply Chain Management.  In addition, the Unified Operations Plan, Customer Engagement Plan, and Dynamics 365 Plan are all being retired. They will be replaced with a more tailored licensing model offering a base license and mix of attach licenses.  This will allow you to purchase only the apps you need.

The diagram below is the new Dynamics 365 licensing structure. It shows the split of finance and operations and the removal of the plan suites and the subsequent addition of the new base and attach licenses for both the Customer Engagement and Unified Operations elements of this product.

new Dynamics 365 licensing structure

You will be able to choose a base license (minimum purchase of 20) which must always be maintained for each user and build up a user profile as needed by purchasing the appropriate attach licenses.

Step by step Dynamics 365 licenses

Step 1: choose your Base License as App1:

Dynamics 365 licenses Base

Step 2: Then build up the profile by adding additional applications from the attach licenses.

Dynamics 365 licenses - Attach

Step 3: Adds any additional users or team member licenses to their mix.

Dynamics 365 licenses - Additional

It is important to note that the additional user licensing is remaining the same and will continue to be available alongside the Team Members, Activity and Operations Device SKUs.  With parity for the Customer Engagement Team Members and Device SKUs.

Existing Dynamics 365 licenses

If you have an Enterprise Agreement you will be able to continue to mix and match SKUs to satisfy minimum purchase requirements.

However, in CSP, because of system limitations, you won’t be able to mix and match SKUs to satisfy minimum purchase requirements and will need to license the minimum quantity of any given SKU to purchase the application as a base application. Any eligible attach SKU can be added to that base application.

Current agreements and subscriptions are unaffected by this license change until they expire. Once that occurs then you will need to purchase the new model, you’ll need plans in place to be able to move and to this new license model for any renewal.

What next?

This change is designed to make Dynamics 365 licensing a little more straight forward and allow you to utilise the applications you need and not purchase a plan which only a portion of the functionality will be utilised. However, if you have experience of the licensing of Dynamics 365 you will understand that the license models can be complex and intricate depending on the individual requirements and as such not all scenarios or license positions have been covered in this blog.

Further details will be released between now and the new license model launch in October, we will keep our customers updated on, but in the meantime, Microsoft have produced this FAQs document and more information on Dynamics 365 product updates can be found here.

More information and guidance on how this change might impact you and your organisation’s specific requirements, please discuss with your Trustmarque Account Manager, or email info@trustmarque.com with your enquiry and we’ll be in touch.

By Rob Kershaw – Trustmarque Licensing Sales Specialist