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Microsoft Reevaluates Power Apps Licensing Amid Customer Concerns

Microsoft clarifies confusion around Power Apps & Dynamics 365 licensing. Initial changes requiring expensive licenses for Power Apps were scrapped.

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Microsoft has recently addressed concerns regarding its licensing policies for Power Apps and Dynamics 365, following a wave of feedback from the software development community. The company had initially announced changes that would have significantly impacted the cost of licensing for numerous organizations, prompting a reevaluation of their strategy. Microsoft’s decision potentially came from the company’s integration of the Copilot AI platform into Power Apps

The Initial Announcement and Its Implications

The initial announcement, which was later removed, suggested a shift in licensing requirements that would compel users of Power Apps to migrate to the more expensive Dynamics 365 Enterprise licenses. Under the previous guidelines, Power Apps users could access data within Dynamics 365 Enterprise as long as they did not modify it under certain restrictions. However, the proposed changes would have redefined these restrictions, potentially increasing the licensing costs substantially.

For instance, a Power Apps subscription, priced at $20 per month, stands in stark contrast to Dynamics 365 CRM Enterprise licenses, which cost $95 per user per month. An organization with 1,000 employees would see its annual licensing fees surge from $240,000 to $1.14 million under the new scheme. This dramatic increase sparked significant concern among Microsoft’s customer base, leading to a reevaluation of the proposed changes.

Microsoft’s Response and Future Directions

In response to the feedback, Microsoft issued a statement, emphasizing that no changes or updates to the licensing requirements for Dynamics 365 or Power Apps solutions would be introduced. The company highlighted the introduction of the “Solution Checker,” aimed at providing a simplified way for customers to understand and optimize their licensing requirements. This tool focuses on ensuring compliance with Dynamics 365 Sales license requirements when developing custom Power Apps applications, with plans to extend its capabilities to additional Dynamics 365 Customer Engagement workloads.

“We are not introducing any changes or updates to our licensing requirements for Dynamics 365 or Power Apps solutions,” Microsoft told The Register, aiming to alleviate concerns within its user community. The integration of Nuvei services into Dynamics 365, which could benefit small and medium-sized businesses (SMBs), remains a significant development. However, the potential impact of the initially proposed licensing changes on SMBs focusing on software development underscores the importance of clear and consistent communication regarding licensing policies.

Luke Jones
Luke Jones
Luke has been writing about all things tech for more than five years. He is following Microsoft closely to bring you the latest news about Windows, Office, Azure, Skype, HoloLens and all the rest of their products.