Upcoming Changes to Dynamics 365 Licensing: What You Need to Know About Stricter Requirements

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Previously, organizations often had more users than licenses, and Microsoft would enforce a “true-up” through an occasional audit. With the new rules, every user must be properly licensed from the outset, ensuring compliance and eliminating the need for retroactive license adjustments.

Beginning on September 1, Microsoft will enable banner warnings on Dynamics 365 environments for users who are not named to a license. We understand that this change may raise questions. Here’s what you need to know regarding the upcoming changes to Dynamics 365 licensing:

Key Highlights

1. How Will Dynamics 365 Impact Access? The noticiations received in September are informational and will not affect users’ access until November.  
2. What Added Requirements Will Be With Dynamics 365’s Stricter Compliance? On November 1, 2025, stricter license compliance will be enforced, requiring all users to have assigned licenses in the Power Platform Admin Center (PPAC) to access Microsoft Dynamics 365 applications. This change aims to ensure that only authorized users with the appropriate license assignment can access or manage applications. 
3. How Will Dynamics 365’s Stricter Licensing Requirements Impact Manufacturing Businesses ? With stricter enforcement, businesses may face higher licensing costs if they have been under-licensed in the past. It’s crucial to evaluate current licensing arrangements and budget for potential increases in licensing requirements. Additionally, businesses will need to ensure the appropriate licenses are assigned for each user, which may require a review of current user roles and permissions. 

Support Options

We’re here to help! As Microsoft’s 2024 Business Applications Partner of the Year Winner, MCA Connect’s team of Dynamics 365 experts can help you easily navigate the new User Security Governance and Licensing tools. Reach out to your dedicated team at MCA Connect, or if you are looking to learn more and don’t currently have a project with us, contact us and we will get you connected.

Reducing Licensing Costs

MCA Connect can assist with everything from baseline education on the licensing changes and how to utilize the new User Security Governance features, to creating a tailored project to review your security setup and how to optimize and reduce license costs. This approach has proven to save clients significant amounts of money in the long run.

How to Prepare for Dynamics 365 Licensing Changes

To navigate these changes effectively, businesses should:

• Review Current Licensing: Conduct a comprehensive review of current licenses and user roles. Identify any gaps or discrepancies that need to be addressed to comply with the new requirements.  
• Utilize Enhanced Reporting Tools: Leverage the new ‘User license level overview report’ available in PPAC or the new LCS integration under ‘licensing and capacity’ to get the same reporting information from PPAC. There are also User Security Governance features coming available in 10.0.43 and 10.0.44, or you can make use of existing security tools you may have already licensed. These tools will provide valuable insights into license allocation and help identify areas for optimization.
• Train Administrators and Users: Ensure that administrators and users understand the upcoming changes and are aware of their roles in maintaining compliance. Provide training on how to use the new reporting tools and manage licenses effectively.