Tag: pricing

Don’t trust the Microsoft 365 admin center product information

In this age of online commerce, and especially when selling digital subscription services, one might think that the online storefronts of large corporations would contain accurate product descriptions. Or that at least it wouldn’t take many years for incorrect information to get fixed.

Neither of these assumptions are correct when dealing with Microsoft 365 admin center’s online store, a.k.a. the “purchase services” tab. The detailed information that is shown to customers who are looking to purchase Power Apps licenses is not valid in this portal. It hasn’t been valid for close to 4 years now.

During the past couple of years, I’ve tried every imaginable channel for contacting Microsoft about this. I’ve reached out to MS partner forums dedicated to licensing information. I’ve posted into Microsoft MVP program related forums dedicated to MS Business Applications licensing information. I’ve reached out directly to the product team who owns Power Apps.

Nothing has helped in getting this information fixed. Which means that I must assume it will never get fixed. The only way to communicate about this to the people who suffer from it (customers, partners) seems to be in writing a blog post like this.

Let’s take a look at the online commerce experience for someone who’s got a Microsoft 365 tenant and wants to purchase Power Apps licenses directly from Microsoft. In this scenario we want to specifically understand the options provided in the subscriptions called “Power Apps per user plan” and “Power Apps per app plan”.

Finding Power Apps products from Microsoft 365 admin center

The first hurdle will be in finding the products. One might think that Power Apps would be listed under the “Business apps” category (since there isn’t a category called “Power Platform”). However, we only find the Power Apps per user plan from that category.

Let’s try a text search. Searching for “Power Apps” (or the old name variation “powerapps”) gives us the results we were after, yet in a surprising place:

Why on earth would the per app plan be categorized under “Power BI”? Well, for the same reason I need to write this blog post. The product information under Microsoft 365 admin center is simply wrong in many cases. This specific miscategorization has been in place for several months now, as an example.

Comparing Power Apps product features in Microsoft 365 admin center

Now what we’ve got the 2 Power Apps SKUs (“stock keeping units”) on the same results page, we can tick the “compare” box on them. Upon opening the comparison page, this is the result we get:

There is absolutely nothing right about these product features. Even the product name and icon in the comparison section are outdated. They refer to the old SKUs of PowerApps Plan 1 and PowerApps Plan 2, which were replaced by the Power Apps per app plan and Power Apps per user plan on October 1st, 2019.

The problem is, someone responsible for the commercial information managed in the Office 365 / Microsoft 365 online store didn’t understand this change was not simply a rebranding. You can’t just replace “Plan 1” with “Per App” and get away with it. Someone truly missed the memo of Charles Lamanna when he announced the change on July 25th, 2019.

“We are also removing feature and capability differentiation across the paid, standalone PowerApps and Flow user-based plans. All customers will be able to benefit from the full features of the services, regardless of which plans they purchase. Key concepts like complex entities, or model-driven applications, will no longer be available in only some of the licenses.”
Taken from “New licensing options for PowerApps and Microsoft Flow standalone paid plans” on Power Apps product team blog

Let’s look at the list of features that are presented in Microsoft 365 admin center ~4 years later and see what errors we can spot:

“Access to Dynamics 365 restricted entities.” It used to be read-only for Plan 2 and no access for Plan 1. Today, the entities (nowadays renamed “tables”) categorized as restricted are read-only for any Power Apps license. Also, everything else has full CRUD rights.

“Create and run canvas apps using common data service for apps”. First of all, “Common Data Service (CDS) for Apps” as a term was replaced with ~~Dataflex~~ …sorry, Dataverse, quite some time ago already. Both Per App and Per User today have identical right to using this, unlike what the comparison table claims.

“Create and run model-driven apps using Common Data Service for Apps”. Showing this as not available in Per App is entirely false. As anyone reading the memo from Charles would have spotted: “Key concepts like complex entities, or model-driven applications, will no longer be available in only some of the licenses.”

“Create and use entities with Business Rules and async workflows”. Available in both Per User and Per App licenses, unlike what the product comparison table says.

“Create and use entities with code add-ins”. Sigh… See above.

“Create and use entities with real-time workflows”. Oh come ON! See above.

“Create databases in Common Data Service for Apps (per user)”. Ooh, what an ancient relic this line is! Saying that Power Apps per user plan allows you to only create 2 databases has no basis whatsoever in the current licensing model. Customers can create as many Dataverse environments (meaning CDS / XRM databases) as their available storage capacity permits. Furthermore, today anyone can create up to 3 Developer environments for themselves, without having any premium Power Apps license.

“Model your data in Common Data Service for Apps”. Does anyone still want me to explain to them that there’s no difference between Per User and Per App entitlements here? No? Good. You got the memo then.

Closing thoughts

For those of use who have been tracking the platform evolution of MS Business Applications over the years, it’s pretty much business as usual to encounter MS materials and information that reference outdated versions of products. The names change, the icons change, the licensing models change – this happens all the time and we’ve come to expect it already.

If you don’t have prior experience on the commercial aspects of Microsoft’s product stack, though – this can be highly confusing. Imagine that you’re trying to compare different low-code application platform vendors and the information provided by the online store is like what we’ve seen above. Not the best way to build trust and convince customers that the pricing model is transparent.

Why does this happen then? Why aren’t the product details updated in customer facing portals? Well, I don’t think anyone intentionally wants to mislead the audience here. I believe it’s simply a reflection of how inside a huge corporation like MSFT it can be very difficult to coordinate such updates. Every time some product gets “reimagined” there must be a million places that would need attention internally at Microsoft (us partners surely feel the impact, too). Sometimes the friction in the systems may just be too great to overcome, such as in commerce engines like Microsoft 365 or technical dashboards like the Azure portal.

Power Platform products and pricing
If you’re interested in seeing the Power Platform product prices on a single page, take a look at a summary that I’ve created for my own reference: Price points of Power Platform. I can’t promise it to be always up to date either, but at least I have a lot less bureaucracy to overcome than the official channels.😁

July 10, 2023
Power Apps pricing drops by 50%
It’s not that common to see Microsoft make an announcement where the price of existing products is cut in half. Today, however, is a special day where we heard that the prices of Power Apps licenses are going to be reduced by 50% :
- Power Apps per user: from $40/month to $20/month
- Power Apps per app: from $10/month to $5/month
Note that this is the new list price – not a temporary campaign price. Using Microsoft’s low-code application platform is therefore becoming considerably cheaper for all customers (eventually).

More revenue via lower pricing

What’s the story behind such a dramatic pricing change? Was Microsoft struggling with selling the platform to customers at the old price point? Well, we will of course never know the full details behind the business planning decisions and the calculations MS has been performing in their own Excels.

My own interpretation is that there certainly hasn’t been any shortage of interest towards Power Apps from the customers’ side. What’s probably happening here is that the high ambitions Microsoft has set for scaling up the broad commercial coverage of Power Platform technologies within their customer base haven’t quite been met with the current pricing model introduced in October 2019. I can easily see how the speed at which low-code is taking over the world isn’t well aligned with the slow licensing agreement negotiation cycles around enterprise software. These are both a blessing and a curse for MS, compared to more nimble competitors in the low-code / no-code space.

To address this need for pricing agility, Microsoft had already launched a promotional offer at the end of 2020 to give volume discounts on per user and per app licenses: $40 > $12 and $10 > $3 respectively. This offer basically made the previously confidential discount levels publicly available, giving a much better indication to larger customers about what the expected true cost level of Power Apps licenses would be. Since there are so many different potential user groups for low-code apps within a typical enterprise organization, it’s problematic if every team does their own business case calculations based on list prices. That doesn’t really deliver the optimal outcome for Microsoft who’d want to sell the one platform for the whole organization through a single high volume deal.

Based on my discussions with customers, it’s pretty obvious that most of them are already confident with the technical abilities of Power Platform. What they are not very comfortable with is the complexity of how the platform has to be licensed. All the confusion and uncertainty is quite understandable, given the many moving parts and the licensing model that appears to have been in flux during the past couple of years.

Any temporary campaign price isn’t necessarily going to alleviate the concerns customers have for the long term costs of licensing Power Platform premium features. Therefore I think Microsoft is looking to provide a clear signal that they’re targeting a very wide scale adoption of these low-code tools – not just for large business critical apps for specific audiences.

Licensing implementation details

Due to how the licensing contracts and MS price lists work, the new Power Apps license prices aren’t yet reflected in the public pricing site, as they’ll only come into effect on October 1st 2021. Any contracts made after that will get the new prices. Same for contracts that are renewed after October 1st. For any ongoing subscriptions the new price points are not applied automatically, because for good & bad, the prices for a customer are locked via these contracts. Keep that in mind when counting the near term costs of Power Apps for your users.

The SKU (stock keeping unit) of the per user plan won’t change, the list price will just come down to $20. For the per app plan we’ll see the old SKU become discontinued and a brand new SKU launched on October 1st. This is because there is more to the changes than just a new figure on the price tag in the per app model.

There’s been this peculiar twist in the original entitlement that allowed a single Power Apps per app pass to run 2 apps & 1 portal within a single environment. While the reasons for allowing both Canvas and Model-driven apps to be used in a single business scenario probably made sense in theory, this has been in practice very difficult for customers to comprehend. It must have also been a huge headache for MS to incorporate into their license reporting and technical enforcement within the platform. Changing the new per app license to cover a single app is therefore a very logical & welcome update. If you really need 2 apps, then just buy 2 per app passes for $10 – the total price is not increasing here, after all.

These changes announced today are specific to Power Apps, which means that the Power Automate price points for per user and per flow remain untouched. This isn’t very surprising, since I believe Microsoft would rather see customers adopt both the app side and the automation side – not just run “invisible” flows behind the scenes. The Power Apps per user plan now gives you these for a small additional cost compared to Power Automate per user plan ($20 vs. $15). As for the other plans, the use cases for per flow process automation or the RPA capabilities are very distinct, in my opinion, so not much pressure should arise from this Power Apps pricing change for those.

What about Dynamics?

Two years ago when the per app plan was launched at $10, there was a lot of discussion on how this might cannibalize the Dynamics 365 products. Paying $95 for an Enterprise Sales license seemed pretty steep in comparison when you could build your own CRM on top of the same Power Platform tools and run it for a fraction of the cost. Well, it looks like the tribes of low-code cannibals didn’t take over the world and Dynamics 365 business has been growing nicely regardless of this move. There certainly is a growing number of “DIY CRM” type of solutions being used now via Power Apps, but one could argue that these customers and their scenarios might not have landed on MS cloud (or stayed there) if the lower priced option didn’t exist.

During the past 1.5 years, after founding a company focused 100% on Power Platform and taking some distance from my prior Dynamics related work, it’s been eye-opening to talk with customers without wearing a CRM hat. Low-code application platforms are a discussion that concerns everyone, regardless of what systems they are using for managing their sales, marketing, service processes. You don’t really need to mention the word “Dynamics” at all in these discussions – unless the customer happens to be running them already. Whatever their CRM or ERP systems are, the Power Platform story is equally compelling when viewed from the broader Microsoft cloud perspective.

When Ryan Cunningham, Power Apps product lead at MSFT, introduces the new pricing model announcement with the title “apps for everyone” – that should give you an idea of where the goals are set. You can’t sell Dynamics 365 to everyone, hence the higher pricing of these products. As for Power Apps, there aren’t many valid reasons why someone could not be target customer for them.

The price will never be “right”

Even with this 50% price reduction, I’m not expecting all customers (or even MS partners, strangely enough) to be happy with the licensing model for Power Apps premium features. As long as everything isn’t free, someone will always complain how the low-code platform pricing model of charging by app usage is “wrong” (instead of paying money for app development work and infrastructure operations).

I don’t think we should expect that the full premium feature set of Power Apps would ever become a free bundle within Microsoft 365. More and more of these high value features like Dataverse for Teams are already “free” for existing customers. They help build up the scale of app usage (see the Teams as a platform story), but there has to be an upsell story to paid Power Platform services somewhere down the line. If there wasn’t, we wouldn’t see such huge investments into low-code capabilities from Microsoft.

Platform licensing is the end game, not per app. Once customer organizations unlock the possibility for all their employees to run & build unlimited apps on the platform, that’s when the real transformation begins. There’s undeniable business value waiting behind that door, and that’s why it needs to have a price tag.

Read more about Microsoft Business Applications licensing
Check out my earlier blog posts in the licensing category.
July 1, 2021
Why Power Platform licensing is complex, part 3: light use scenarios
In this series we’ve talked about the complexity that arises from how Microsoft defines (and re-defines) their product structure, as well as the concept of multiplexing where indirect usage of software (or data) needs to be licensed just like direct usage is. In this third chapter it’s time to look at the varying depth of software usage and how the licensing models out there don’t always take this into consideration the way people would expect them to.

“I only need to do X, why do I have to pay full price?”

For any business application deployed within an organization there’s bound to be a group of heavy users who spend a significant share of their working hours using the broad range of features offered by it. They might be administrators of a process that is managed with this app, or users whose tasks are either handed out via the app or facilitated by the information that the app can provide them. A service technician might have his or her day planned out in detail via Dynamics 365 Field Service. A salesperson could be using customer information and activities to keep track of their pipeline and prioritize actions via Dynamics 365 Sales.

Then there are those employees whose roles aren’t primarily focused on the aforementioned processes but who need to participate in them in some stage, or consume the outputs from these processes as one ingredient of their work. It might be merely signing off on an approval or completing a task that has been generated from the end-to-end business process. Again we could use here the same example as in Part 2 where merely submitting a new lead via a web form that has fully automated connectivity with Dynamics 365 will mean that these employees must be equipped with a type of license that would essentially allow them to also work with the lead qualification process of an full-time inside sales role. Hmm, why are these two very different personas treated the same, when one is a very light touch scenario and the other a heavy use of the system?

Whether you perform the task once a year or a hundred times a day doesn’t make a difference, due to the way how these business applications licensing models are constructed. It’s not a consumption model where you’d pay for the number of events and computing capacity like in Azure, rather it’s all based on purchasing the rights for a specific user to access feature X in the application. Underneath the app UI there is of course the same Azure technology being consumed to keep the bits running, but products like Dynamics 365 are quite a thick value-add layer of SaaS on top of it that removes the need for you to pay for the infrastructure. Similarly it removes the need for a custom software development project to manage your sales process, as an example, because you can simply subscribe to the Dynamics 365 Sales product and gain access to all of the business logic, UI, security models, auditing, APIs and numerous other features you’d eventually need for your digital business to operate in a sustainable way. You get a lot, so it’s only fair that it should cost something, too.

Still, it’s very common to run into a scenario where the idea of licensing every actor involved in the business process with the same flat monthly fee just doesn’t feel justifiable. In the Dynamics 365 world it might involve working with a single entity that’s not covered by the Team Member license. On the Power Platform side it might be a Flow that would need to do one step that inolves a Premium connector. All of a sudden the cost of allowing users to touch these tools might multiply the monthly fee, just because of that one thing. Couldn’t we, you know, just make that one thing be excluded from the Premium category and solve this dilemma?

Virtual borders vs. platform unions

It’s not like Microsoft wouldn’t be aware of the issues with these functionality borders and how they end up blocking many otherwise valid scenarios for leveraging their software products. Obviously there could be more money to be grabbed from the table if only there was a suitable licensing card to be played in these occasions. The problem is that every customer’s problem tends to be slightly different. Moving one feature checkbox from this license type to that license type isn’t therefore the answer. It would be like trying to adjust the borders of a country to follow a slightly different pattern so that you could optimize where you live, work, shop, go fishing, use medical services, and so on. A border will by definition limit your freedom in some ways, in exchange for offering you rights to (hopefully) exercise your freedom within the area covered by it. You gain some, you lose some.

In an interview by MVP Steve Mordue, Steven “Guggs” Guggenheimer described these light use / light touch scenarios and the licensing demands around them as “the most complex thing you’ll ever see”. Be it Dynamics 365 or Office 365, there doesn’t seem to be a satisfactory way to draw a line between heavy use and light use for the software products because when it comes to licensing everyone wants both A) simplicity and B) flexibility, which are C) a paradox.

There is a collective challenge, which is how do you build a licensing framework where you can’t tell between the two, light touch or light use, or you can tell but there’s no consistency. If I ask the question, “What does light touch mean to one ISV or light use?” I’ll get a very different answer than what I get from another one, so you can’t design a licensing type that works for everyone.

Looking at the evolution of Dynamics 365 products that used to be called CRM, then Customer Engagement and now “Model-driven apps in Dynamics 365”, they’ve been moving towards an “á la carte motion” where instead of subscribing to the whole software suite (Plan) you instead buy individual Apps. While initially this might sound like something that addresses the aforementioned customer pain points, I believe it’s mainly aimed at allocating the revenue more accurately between Microsoft product teams (and thus creating clear incentives for new product development) rather than making Business Applications less complex for customers to license. After all, you’ll often still need to buy a minimum of one Enterprise app at a list price of $95 per user per month, which isn’t exactly a figure that’s a great fit for the light use territory.

The platform SKU, meaning Power Apps Per User Plan, is closer to solving some of the challenges for customers that are ready to consider broadly licensing their work force for the business application platform rather than individual apps. Sure, a $40 list price is still more than Microsoft 365 E3, for example, so not an insignificant cost by any means. The more app scenarios you can cover in your organization with that flat platform fee, the cheaper it becomes. The first time you need to cross the border to the Premium territory it’s still a costly visa to acquire, but the more you travel the cheaper the relative investment becomes. You could compare this to a political and economic union like the EU, where benefits of having a single market that allows free movement of people, goods and services can outweigh the cost of forming and running this union. The application platform opens up opportunities by removing some (but not all) borders for your organization’s employees to participate in the digital processes runnign on top of it, regardless of if it’s just an occasional holiday trip to the neighbouring business unit or a permanent role of deep co-operation.

Alternative pricing methods

The Power Platform today requires you to purchase a license for each internal user, but there already is a mechanism available that would in theory allow paying for the actual usage. It’s the new pricing model of Power Apps Portals, where instead of buying the Portal application itself you purchase capacity to be consumed by the usage of the portal. This covers unauthenticated usage like page views, which isn’t all that relevant for real business application use cases. However, the concept of paying for each login of an authenticated user would be very applicable to many light use scenarios with infrequent but still valuable application usage.

The beauty of a consumption based pricing model like this would be that you wouldn’t need to purchase a full licenses for each and every user that might or might not use the system during any given week. However, when there would be a valid business need for them to access the system and use some of it’s features, they could be assigned a “day pass” that grants them the license for a 24h period. If on the next day they again need to do the same thing, it’s a new pass to be consumed. Doesn’t this sound like exactly the sort of a mechanism that could…?

Unfortunately as of today there isn’t yet a way for customers to purchase these type of day passes for their internal employees. The Portals licensing model is limited to only external users, whereas internal users must be assigned either a Power Apps license or an applicable Dynamics 365 App license (note: Team Member license does not apply here). There is some irony here because the per-login pricing model is actually making Portals a tough sell for some of the intended external audiences. Buying pre-paid packages of login capacity that would cover you entire potential user base of customers that might or might not log in to your public website can quickly become so costly that it makes more commercial sense to build a custom portal with custom integration into CDS instead of leveraging this product capability built by Microsoft (at least with the list price).

Regardless of these current challenges with aligning the license terms, I do believe the roads in Power Platform are eventually leading more and more towards the model of licensing by consumption. Not as the primary mechanism, but as something that will complement the user based licenses. This is because ultimately the goal should be value-based pricing. How do you measure the value generated by the business applications that are running on your shared cloud platform and used by millions of people out there for their own specific business processes? Well, the usage of the software products is a nice concrete way to gauge the potential sources of value – as well as idetifying places where the value is certainly not being captured (due to lack of usage/adoption).

In the on-prem era where some of the enterprise software licenses practices we still see today were originally drafted, you were selling a big system that the customer would acquire the server & user licenses for and then deploy the whole thing behind their own firewalls. The cloud has changed this model whereby the SaaS vendors are now able to see in much more detail the metrics for active usage (DAU, WAU, MAU) from the customer environments running on systems that they operate. In addition to ensuring that the customers keep renewing their subscriptions, access to this usage data also opens up possibilities for offering alternative pricing models that would make the many light use scenarios more attractive for large pools of potential users. The example of charging for app access by every 24h may not be the model that will be offered to internal users, but at least it represents a much less complex mechanism for customers to digest than the earlier models of drawing licensing lines between entities, features or access types.

Other parts in this article series can be found here:
Read more about Microsoft Business Applications licensing
View all my blog posts in the licensing category.
May 31, 2020
Price points of Power Platform (2022 pricing and licenses)
NOTE: This post was originally published in March 2020, the last revision of pricing information is from November 2022.

As of today, there isn’t a single place from where to check the actual prices of the different license types covered by the Microsoft Power Platform suite of products – like there is for Dynamics 365, for example. The information of prices vs. what paying that price actually entitles you to is distributed across several information sources and formats – starting from the individual product pages, to the learn.microsoft.com documentation pages, to the PDF licensing guides.

To stop myself from having to always use a search engine to discover these pricing details, I decided to compile a list of links to the places where each individual Power Platform product team has made their pricing information public, as well as write out the current subscription prices in US Dollars and Euros. I’ve also included a few relevant licensing model elements that describe what the particular subscription entitles you to do (capacity, features and so on).

Most of Power Platform product licensing is done via the prepaid subscription model familiar from Microsoft 365 (Office 365). More recently the pay-as-you-go (“PAYG”) option has been introduced for some of the services, allowing payment via an Azure subscription (read more about the November 2021 announcement here). It’s important to note that in general prepaid subscription prices are cheaper than pay-as-you-go. The PAYG option is primarily aimed as an option for customers to use, before they know the true consumption level and are ready to commit to a prepaid subscription. Where applicable, I’ve included the PAYG prices here for comparison.

Your actual licensing costs will of course depend on the types of agreements your organization has with Microsoft. So, consider the prices on this page as mainly a starting point for understanding the relative costs of different Power Platform services.

Power Apps / Pages

Power Apps pricing

Power Apps per app plan: $5 (€4.20)
- Allows you to access one Power Apps app (canvas, model-driven, portal/website).
- The same app in different Power Platform environments (dev/test/prod) requires a per app license for each environment.
- Pay-as-you-go option: $10/monthly active user/app/month
Power Apps per user plan: $20 (€16.90)
- Allows you to access an unlimited number of Power Apps (canvas, model-driven, portal/website) in your tenant.
- Can also be used for accessing canvas apps shared to guests in another tenant (not applicable to other app types).
Power Apps pricing change on October 2021
Before Oct 1st 2021, the Power Apps per app list price was $10 and Power Apps per user $40. See this blog post for more details on the price reduction as well as changes in the per app license entitlements. Note that your license agreement may still apply to the old terms, based on the contract duration.

Power Pages (formerly Power Apps Portals)

Power Pages pricing
- Power Pages authenticated user capacity, 100 monthly active users: $200 (€168.70)(see also discount tiers).
  - Pay-as-you-go option: $4/user/site/month
- Power Pages anonymous user capacity, 500 monthly active users: $75 (€63.20) (see also discount tiers).
  - Pay-as-you-go option: $0.30/user/site/month
- Internal users (employees) can be licensed separately, via Power Apps or Dynamics 365 licenses, or as authenticated users.
Licensing FAQ: Power Pages

Power Apps portals (old licensing model, before Power Pages)

Differences between Power Pages and Power Apps portals licensing model
- Power Apps portals login capacity add-on, 100 logins per month: $200 (€168.79)(see also discount tiers).
- Power Apps portals page view capacity add-on, 100,000 page views per month: $100 (€84.30).
- Internal users must be licensed separately, either via Power Apps or Dynamics 365 licenses.
Dataverse capacity (formerly “Common Data Service” / CDS)

Power Apps and Power Automate licensing FAQ: Add-ons

Storage
- Dataverse Database Capacity (1GB) $40 (€33.70) per month
  - May still show up as “Common Data Service Database Capacity”
  - Pay-as-you-go option: $48 per GB used per month
- Dataverse File Capacity (1GB) $2 (€1.69) per month
  - May still show up as “Common Data Service File Capacity”
  - Pay-as-you-go option: $2.40 per GB used per month
- Dataverse Log Capacity (1GB) $10 (€8.40) per month
  - May still show up as “Common Data Service Log Capacity”
  - Pay-as-you-go option: $12 per GB used per month
See also: What Dataverse capacity is included with the Power Apps and Power Automate plans?

Power Platform / Dataverse API calls / API requests:
- Power Platform Requests add-on: 10,000 daily API requests for $50 (€42.20) per month
  - Formerly known as “Power Apps and Power Automate capacity add-on”
See also: Requests limits and allocations

Power Automate (formerly “Microsoft Flow”)

Power Automate Pricing

Power Automate per user plan: $15 (€12.60)
- Allows individual users to create unlimited flows, execution is limited based on available API requests per day (40,000 included)
- Note: while Power Apps per app and per user plans includes similar rights, they are tied to the context of a canvas or model-driven app
Power Automate per flow plan: $500 (€421.50) for five flows per month
- Allows the organization to implement 5 flows, regardless of the number of users who trigger them
- Child flows triggered by a parent flow do not need to be licensed
- Execution is limited based on available API requests per day (250,000 included)
- Additional flows can be purchased at $100 (€84.30)per flow per month
- Pay-as-you-go option: $0.60 per each cloud flow run
Power Automate per user plan with attended RPA: $40 (€33.70)
- Allows individual users to run an attended RPA bot on their workstation
- Presumably also contains similar rights as the standard Power Automate per user plan
- Pay-as-you-go option: $0.60 per each attended desktop flow run
Power Automate unattended RPA add-on: $150 (€126.50)
- Allows the organization to run a single unattended RPA bot, no dependencies to users or workstations
- Add-on requires either per user plan with attended RPA or per flow plan
- Pay-as-you-go option: $3 per each unattended desktop flow run
See also: Power Automate licensing FAQ.

AI Builder

Power Apps and Power Automate licensing FAQ: AI Builder

AI Builder capacity add-on: $500 (€421,70) per unit per month
- Each unit contains 1 million service credits on the tenant level
- Allows the organization to use any of the AI model types included in AI Builder
- AI models consume service credits when they are trained, used in an app or flow, or scheduled to periodically run. The amount of capacity consumed varies based the AI model, as well as the size and complexity of the data set. See AI Builder calculator to estimate the capacity requirement and cost of your model.
- Add-on requires at least one paid Power Apps, Power Automate or Dynamics 365 license
- For the built-in Business Card scanning feature in Dynamics 365 Sales, there is free capacity included in Sales Enterprise App licenses: 10 scans per user per month, pooled at tenant level. Sales Insights has a capacity limit for business card scanning of 200/user/month. If additional Business card scanning capacity is required, Sales Enterprise customers may purchase additional Sales Insights licenses. (Taken from Dynamics 365 Licensing Guide PDF document.)
Power Virtual Agent

Power Virtual Agents pricing

Assign licenses and manage access to Power Virtual Agents

Power Virtual Agent: $1,000 (€843.20) per 2,000 sessions per month
- Allows the organization to have an unlimited number of bots
- In addition to the tenant license, internal users will need to be assigned a user license. The tenant license costs money, but the user licenses that are purchased via the same mechanism are apparently free.
- “A session is an interaction between the customer and the bot, and represents one unit of consumption. The session begins when an authored topic is triggered. These sessions are referred to as ‘billed sessions’ in the product. Sessions are deducted for both testing and production usage.”
Power BI

Power BI licensing in your organization

Power BI Pro: $9.99 (€8.40) per user
- Included in Office 365 E5 subscriptions for no additional charge
- Each Pro license gets 10 GB of data storage capacity
Power BI Premium per capacity: starting from $4,995 (€4,212,30) per organization
- Offers dedicated compute and storage resources for your organization
- No per-user license assignment needed for report consumption, report creation and sharing still requires Pro licenses for users
- Required for advanced features, see comparison table
- See What is Power BI Premium and Power BI Premium FAQ for more details
Power BI Premium per user: $20 (€16.90)
- New option to access premium features without organizational capacity purcahase requirement.
Dive deeper into the licensing details
Microsoft usually posts monthly updates to their licensing guide PDF documents. Here’s where you can grab the latest copies: Power Apps and Power Automate Licensing Guide & Dynamics 365 Licensing Guide.
March 15, 2020
Licensing by consumption: pricing model of Power Platform online services

On the topic of Dynamics 365 and PowerApps licensing changes coming in October 2019, I earlier wrote about the biggest change in how Microsoft is separating the first party applications and the underlying platform in the new Per App pricing model. There’s another aspect in the coming licensing updates that has also caused a lot of concern among partners and customers: the API call limits. While the existence of limits on how much load one can place on the online service are not an entirely new construct, it’s the first time that the amount of API calls available is directly tied to the type of licenses bought.

In their August 29 blog post, Microsoft stated the following:

“A single, integrated approach for daily capacity limits will be implemented to help maintain a consistent quality of service for customers with PowerApps and Flow plans. These capacity limits should not impact standard or reasonable usage of PowerApps or Flow. Organizations that require additional capacity for heavy usage scenarios will be able to purchase add-on capacity and assign it to specific users or processes.”
Updates to Microsoft 365, Dynamics 365, PowerApps and Flow Licensing

The finer details of the new model are outlined in the PowerApps and Microsoft Flow licensing FAQs for October 2019 as well as the Requests limits and allocations pages over on docs.microsoft.com. You should keep an eye on these documentation pages, since further information will be made available, based on the incoming questions from customers. There have already been a lot of blog posts around this topic and I’m not expecting the debate to die out anytime soon. Rather than speculating about what the exact policies will be, I will instead try to set this new consumption based licensing into context with what’s happening in the Microsoft Cloud.

Users aren’t the only thing that matters

USL, user subscription license, has been the dominant model for pricing applications from Microsoft in the online services era. Of course they’ve been a key component ever since the personal computing revolution started with PCs running DOS, then Windows and many productivity applications like those found in the Office suite. The networked computing era extended the pricing models to server software that wasn’t always purely a per-user play, as the complexity and robustness of your back-end services determined how expensive that side was. In the initial wave of SaaS business applications, we saw a return to the simplicity of just paying a fixed fee like $50 per user and getting all of that server stuff covered for you. Oh bliss! Isn’t this exactly the way the cloud should be sold?

Those first SaaS services also were in themselves quite simple. A replica of the server software you could have either in your own closet or the data center run by companies like Amazon and MS. You just offloaded the complexity involved in managing hardware redundancy, backups, storage etc. and instead payed for all that in the USL. This is all fine and dandy as long as the value from the applications can be closely linked to the number of licensed users accessing it. Using CRM as a simple tool to improve sales person productivity might map into this type of cost-value structure. But how about when you take a step further on the digital transformation path and start to actually replace those tasks carried out by human employees with something that is almost fully automated? Hmm, perhaps the PC business model isn’t optimal for a future that looks like this.

Let’s look at some of the new services in the Dynamics 365 cloud. The commercial launch of Dynamics 365 for Marketing in Spring 2018 was a bit of a shock for anyone who always though these applications are licensed per user. Instead, Microsoft chose the model that HubSpot any many other vendors in the marketing automation space apply, by setting the pricing per contact. Yes, initially they were way off with this thinking by applying the pricing logic to the entire contents of the CRM database, but based on market feedback the model was adjusted to now count only for marketing contacts actually used by the specific application (i.e. where business value should be generated). Also, you actually don’t need any Dynamics 365 user license for those marketing people who build the customer journeys and analyze the results, since free user licenses are available to unlock the door into the system. Licensing is done on the environment level, after all.

Dynamics 365 Customer Insights is a CDP (Customer Data Platform, for those not keeping up with the latest acronyms) that allows customers to bring in customer related data from various different sources and unify them into a “customer 360” profile that links all those activity entries into a single view of the customer. You can then leverage big data processing features of a CDP to generate target segments like customers most likely to churn, select them to be a target group in Dynamics 365 for Marketing customer journeys and preserve your revenue streams by holding on to these customers identified by the intelligent machine in the cloud. How is this service priced? Per number of profiles: starting at 100k profiles for $1.5k, so 1.5 cents USD per profile. Any user in the tenant can be simply authorized to access the application, since the dedicated UI doesn’t have any dependency to the USL construct found on the Model-driven application side.

Forms Pro is a professional version of the personal/team productivity app found in the Office 365 suite, storing its data into CDS entities for process automation and data analysis. Do you need a USL for the Pro features? Nope. The pricing is based on the number of responses to surveys, at $100 per 2k, making it $0.05 per response. If you want to listen to your customers and improve business outcomes as a result of that, it’s not about how many people you have looking at the data but rather how smart and how automated your feedback management processes are.

AI Builder will go GA in October 2019. Guess how that’s going to be priced? That’s right: not per user. You buy a capacity license at $500/month for 1M “service credits”. When it comes to machine learning models as a service, with no pre-packaged Dynamics 365 app on top of them, there isn’t even any concept like contact or survey response that would tie the pricing to the physical world. You literally extract value directly from the data you put in there, with the help of apps and automation that builds on top of and integrates with your unique business processes.

The consumption pricing model is already here. Future products in the Business Applications portfolio are more likely to gravitate towards that, rather than finding a user to attach a price tag on.

Sandcastles in the sky and how to draw the lines

In the cloud era, Microsoft can see everything. No, they don’t have employees looking at any customer’s private data or anything like that. What I mean is they have telemetry data on everything that happens on the service, because they are hosting all the moving parts involved. This gives them the opportunity to be very data driven in analyzing how products are adopted, what people actually do with them. It is essentially their own implementation of the digital feedback loop that you see James Phillips preaching to Microsoft’s customers and partners in every keynote he does. There’s the “transform products” part that is all about aligning product features to meet customer needs, but you can be sure MSFT also want to “optimize operations” when it comes to the logistics of delivering the cloud services and how to price them appropriately.

Dynamics 365 is claimed to be the biggest service running on Azure today. Now, even though at Microsoft they both fall under the Cloud & AI that Scott Guthrie runs, there’s not a single bucket where all the costs would be thrown. The more Business Applications products are built that consume data storage and compute capacity, the higher the bill from Azure will be. The term COGS (cost of goods sold) is being used frequently when talking about the resources needed to keep cloud services up and running on these platforms like Azure. Power Platform is a platform on top of another, and while it often uses higher levels of abstraction that its raw Azure counterpart, API calls from the citizen developer PowerApps do turn into API calls against Azure services. Whatever product is generating this consumption must also front the bill.

The vast majority of Dynamics 365 business today is still done based on user licenses, regardless of what our AI & big data driven future may look like. These are sold as SaaS apps you can just sign up and start using, rather than a complex solution that needs a technical architect to build the blueprint for. As such, the message Microsoft wants to get out there (but isn’t always so good in phrasing) is that the app user license should cover all normal usage for real human beings interacting with Dynamics 365 CE. Yes, anytime a user opens a contact form on a Model-driven app there are around 10 API calls made, which count against the quota for that particular user account. All CRUD operations theoretically count, but for an end user you shouldn’t need to count them. This is not the intention of MS.

What is the idea behind setting the API call limits then? Well, the situation is this: the platform has evolved from the early days of being a simple CRM database for sales user productivity improvement into something that can connect OoB to a vast number of external (non-CDS) data sources and run complex automation on this data without anyone sitting in front of their PC and opening those contact record forms. When sold as Power Platform, there will be a massive amount of this non-CRM style consumption of computing resources running on the platform (unless MS completely fails with capturing this new business potential). Building all of this abstraction on top of the underlying Azure services and then giving it a way with essentially a per-identity flat monthly fee just wouldn’t be a sensible business model.
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September 12, 2019
Working with Price List Items in Dynamics CRM

Despite of the recently refreshed user interface of Dynamics CRM 2013 that offers a much more fluid user experience than previous versions, there are still areas in the application that are not very user friendly. Many of these revolve around product and price information, regarding how it is presented and what actions are allowed on it. In this blog post I will drill into a common scenario that organizations who use CRM for managing price list data may run into and present a few options on how to make their lives easier.

Price List and Price List Item Views

A pet peeve of mine in Dynamics CRM has always been the UI that the Price List entity offers to the end user. As many of the readers of this blog will surely know, price list items are the way how products, units, price lists and the all important price figures come together in the CRM data model. If you want to leverage the product catalog and any price calculation features in the sales module, you’ll need to work with price list items and create at least one of them per each product you plan to include as line items on your opportunities, quotes, orders and invoices.

Unless you’ve built a custom integration to a back-end system that will automatically provide the latest pricing information for CRM, there’s quite a bit of work involved in maintaining individual price list item records when prices change or new products or lists are introduced as a normal part of the day to day business. When a CRM user opens a price list record, a reasonable assumption to make would be that he or she is interested in reviewing the pricing information given to the included products. Unfortunately the Dynamics CRM UI does not make such an assumption, rather it thinks the user is interested in only viewing a list of products and their units but not the actual price information in the amount field. Here’s what the default associated view of the price list items gives us:

Well, that sure looks like a good candidate for some entity customization work. Yes, it does, but there’s a “but”. When you open the customization UI and navigate to the price list item entity, you discover that the views are actually not customizable. Nor can you add any of your own views for that matter, which means you’re stuck with the default UI. If you think that the price list item entity should allow view customization, then there’s a suggestion on Microsoft Connect that you definitely should go and vote for (if you need help in registering to Connect itself, see this post).

Exporting the Price List Item Data to Excel

With this limitation in mind, what are our options of producing a true price list view with product and price information shown side by side? For any Dynamics CRM power user the first thing to come to mind will surely be to export the data into Excel. Unfortunately the uncustomizability of the Price List Item entity also means it has been blocked from showing up in Advanced Find, which would normally be our tool of choice for preparing a CRM data export.

Luckily there’s still an Export to Excel button visible in the ribbon of the price list form when we are viewing the associated price list items view. Clicking this will present us with an option to either export the data in static format (which would just give us the same columns as the current view) or to create a dynamic Excel sheet in two possible formats. Both of the latter options, pivot table and worksheet, present a follow-up dialog where choosing the required columns from the price list item entity and even any parental entity like product is possible.

When you export the view into a dynamic Excel sheet in an on-premises CRM environment, you can actually go and look at the SQL query that the view is using for pulling the data from CRM to Excel. Just click “Change Data Source – Connection Properties – Definition” and copy the query from the Command Text window into Notepad. With a little tweak that removes the reference to the currently viewed price list record we can use the same dynamic Excel sheet to retrieve price list item data for all the price lists in the system.

In the SQL query you’ve copied to Notepad you’ll find a reference to the price list from under which we exported the related price list items. It will look something like this: where (“productpricelevel0”.pricelevelid = N’CEA84006-AD7B-E311-9405-00155D6214FA’) . Just remove this whole where clause, thus expanding the query to retrieve all records from the price list items table in CRM, regardless of the associated price list. Then with the Excel pivot table tools you can group and filter the data any way you please, effectively creating a price list report that views the latest information from CRM in a layout that best suits our purposes. (more…)

March 31, 2014