Microsoft to end plan-based licensing of Dynamics 365 Customer Engagement, aiming for focus on app value

Microsoft will end the use of licensing by "plans" in Dynamics 365, the company revealed at its the Inspire 2019 partner conference this week.

BREAKING: Microsoft moving from #MSDyn365 Plan licensing to a la carte licensing. #MSInspire pic.twitter.com/az3j53fwwn

— Tommi Oksanen (@tommioksanen) July 16, 2019

The new approach goes into effect on October 1, 2019, as the above slide and tweet by Dynamics 365 CE professional Tommi Oksanen shows. Existing customers will see the new pricing model starting with renewals in Microsoft's fiscal 2020 at "the best renewal price" with additional incentives for CSPs selling over 100 seats.

The thinking, as Oksanen captured through a series of Microsoft slides, is that:

• 80% of Dynamics 365 Customer Experience users use a single app
• Plans are not aligning with value. For example, many of those customers end up paying less for the plan than they would if they were buying the single app that they really use.
• Plans lead customers to focus on price rather than value in discussions with Microsoft and partners.
• Paying for capabilities they don't need also impacts perception of value.
• Plans prevent monetization of future enhancements.

The future for Dynamics 365 Customer Engagement will be to sell a base license with "attach licenses" if needed. Those attach licenses would be heavily discounted, ...