Power Platform licensing explained
One of the most frequently asked questions we receive at Breathbase is about licensing. The Power Platform licensing model is complex and changes regularly. A wrong licensing choice can lead to unnecessarily high costs or to limitations that undermine your solution. In this article, we provide a clear overview of the available options and help you make the right choice for your organization.
The basics: standard versus premium
The most important distinction in Power Platform licensing is between standard and premium connectors. Standard connectors such as SharePoint, Outlook, and Excel are available with most Microsoft 365 licenses. As soon as you need premium connectors, such as Dataverse, SQL Server, HTTP, or custom connectors, you need an additional Power Platform license. This distinction is the foundation of all licensing models.
Per-user and per-app licenses
The per-user plan
The per-user plan gives an individual user unlimited access to the entire Power Apps platform, including all premium connectors, Dataverse, and custom connectors. This is the most flexible option and ideal when users need multiple apps or when you regularly roll out new apps. The per-user plan is available for Power Apps and separately for Power Automate.
The per-app plan
The per-app plan is cheaper per user but limited to one specific app or portal. This is ideal when you have an app used by many users, but those users do not need access to other Power Apps. Think of a self-service portal for customers or a specific inspection app for field workers.
Pay-as-you-go and seeding licenses
Pay-as-you-go
With pay-as-you-go, you only pay for what you actually use, via an Azure subscription. There are no predetermined user counts or annual contracts. This model is particularly suitable for apps with variable usage, seasonal work, or pilot projects. Costs are calculated monthly based on the number of unique users who opened the app.
Seeding licenses
What many organizations do not know is that certain Microsoft 365 and Dynamics 365 licenses already include Power Platform entitlements. A Microsoft 365 E3 or E5 license provides access to Power Apps and Power Automate with standard connectors. Dynamics 365 licenses often include extensive Power Platform entitlements including premium connectors and additional Dataverse capacity. Always check what entitlements you already have before purchasing additional licenses.
The cheapest license is the one you already have. Always inventory the entitlements that come with your existing Microsoft 365 and Dynamics 365 licenses before purchasing additional Power Platform licenses.
Dynamics 365 licenses and bundles
Dynamics 365 licenses work with a base license and attach license model. The first app (for example Dynamics 365 Sales) costs the full per-user rate. Each subsequent app for the same user is available as a cheaper attach license. This makes it financially attractive to use multiple Dynamics 365 modules. Also account for team member licenses for users who only need read access or perform limited edits.
Additionally, there are capacity-based licenses for Dataverse storage (database, file, and log), API calls, and AI Builder credits. Monitor your consumption regularly to avoid unexpected costs and scale up where needed.
Optimizing costs
Based on our experience at Breathbase, we recommend the following strategy for cost optimization. Start with an inventory of your current licenses and their included entitlements. Map out how many users will use which apps and how frequently. Use per-user licenses for power users who use multiple apps and per-app licenses for apps with many occasional users. Consider pay-as-you-go for pilots and seasonal apps. Evaluate your license mix every quarter and adjust where needed. A well-thought-out licensing strategy can save thousands of euros per year without compromising on functionality.
