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From Microsoft Dynamics CRM to 365 On-Premises: How licensing will draw on-prem users to cloud model

by Jason Gumpert

Microsoft Dynamics 365 Dual Use RightsWith the arrival of the December 2016 service update, Microsoft Dynamics CRM 2016 on-premises has adopted its new identity as "Dynamics 365 (On-Premises)". The update adds new capabilities and new licensing decisions for customers. 

Partners who have started working with the the new licensing options say the transition to Dynamics 365 allows CRM on-premises customers to stay the course with their current deployment model, but that cloud licensing options now have some clear benefits that they can still buy into. Microsoft has provided a new licensing guide (PDF download) explaining the on-premises customer's licensing options for the future.

The December 2016 update for Dynamics 365 applies to the suite's enterprise-level sales, customer service, field service, and project service automation apps. The update offers a range of functional enhancements in areas including mobile tools, the Dynamics 365 App for Outlook, a preview of Relationship Insights, learning paths, relevance search, editable grids, and Office 365 Groups.

Real world experience with the first official Dynamics 365 (On-Premises) release seems to be limited at this point. At least one large Dynamics CRM partner with whom we spoke reported no experience so far with transitioning customers to Dynamics 365 (On-Premises) via the December 2016 Service Update, though other partners report having worked through some of the decisions with customers already.

"Dual use rights", which give customers the ability to invest in a Dynamics 365 cloud-based plan but to retain the option run their solution in a private ...

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About Jason Gumpert

As the editor of, Jason oversees all editorial content on the site and at our events, as well as providing site management and strategy. He can be reached at

Prior to co-founding, Jason was a Principal Software Consultant at Parametric Technology Corporation (PTC), where he implemented solutions, trained customers, managed software development, and spent some time in the pre-sales engineering organization. He has also held consulting positions at CSC Consulting and Monitor Group.

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