Power Apps has always been licensed on a per user or per app basis but now it is also available under the Pay as you go (PAYG) model. Microsoft see this as a way to help organisations innovate faster with less wasted spend as it doesn’t require licenses to be allocated to specific users.
How it works
You connect the apps environment to an Azure subscription and then pay for usage via 3 meters:
Power Apps per appPAYG
Pay when a user runs an app – rather than the existing model of allocating licenses beforehand and seeing them consumed based on apps being shared rather than run.
An active user is someone who opens an app/portal at least once a month – usage by users licensed on a per user basis is not included. Cost is $10 per active user per app per month.
This is the new name for API calls and, as standard, you get 6.000 API calls per user per app per day – Microsoft believe this will be enough for most users. If it isn’t, any additional API calls are charged at $0.00004 per request per day.
Note that the request example includes both Power Apps and Power Automate.
Where it makes sense, organisations can use both the per user and PAYG models simultaneously.
Cost Management
These new meters will be available within Azure Cost Management, meaning costs can be tracked, budgets can be set, and resources can be tagged. For some organisations, particularly those where FinOps is stronger than ITAM, this new approach may yield better results.
The November 2021 Microsoft Product Terms contains quite a few updates!
Microsoft Managed Desktop
As an offering, it’s been available for a while as a bit of a hidden secret almost but now it’s in the Product Terms.
Microsoft Viva
A few additions here:
Microsoft Viva
Viva Learning
Viva with Glint* add-on added
which rounds out the Viva line-up in the Product Terms (I think!):
*Glint is a 3rd-party product that sits in a similar, complementary area – see more here.
Defender products
Another addition to the Defender line up as:
“Microsoft Cloud App Security (MCAS)” is renamed to “Microsoft Defender for Cloud Apps”
I’m not 100% sure I agree with this name change as I feel it downplays the capabilities of MCAS as a Cloud Access Security Broker (CASB) for a start.
Additionally, Microsoft Defender for Endpoint Plan 1 has been added (see more here) and the existing version renamed to Plan 2.
Following on from the above, a new product has appeared…
App Governance add-on for “Microsoft Defender for Cloud Apps”
This is a “security & policy management” product for OAuth-enabled apps that access Microsoft 365 data via the Microsoft Graph and aims to help organisations govern, detect, and remediate 3rd-party access to corporate data in Microsoft 365.
A new “Power Apps per User” 2000 seat minimum SKU has been added – clearly Microsoft are seeing/expecting large scale rollouts of PowerApps…especially after its 202% year-on-year growth in Q1!
Productivity Servers
It was revealed a while back that the next releases of the Productivity Servers (Exchange/SharePoint/Lync), as well as Project, would be subscription only and now some of them have arrived in the Product Terms.
Just Project and SharePoint have been added currently but I’d imagine the same rules will apply to the other products. They are now officially known as:
Project Server Subscription Edition
SharePoint Server Subscription Edition
and active Software Assurance (SA) is required to run the latest “Subscription edition”. However, should SA lapse, you receive perpetual rights to run the 2019 version.
Microsoft Clouds
Two previously announced Microsoft Cloud products:
“Financial Services”
“Nonprofit”
have been added, as add-ons, to the Product Terms. They can be added on top of the following licenses:
Financial Services
Microsoft 365 E3/E5
Microsoft Project
Power Apps/Power Automate/PowerBI
Dynamics 365 Customer Service Enterprise
Dynamics 365 Digital Messaging
Dynamics 365 Customer Insights
Dynamics 365 Sales Enterprise
Dynamics 365 Customer Voice
Non-Profit
Office 365 E3/E5
Microsoft 365 E3/E5
LinkedIn Sales Navigator
Power Apps/Power Automate/Power BI
Dynamics 365 Sales Enterprise
Dynamics 365 Marketing
Azure App Service
Non-Profit comes in 3 flavours:
Basic
Plan 1
Available to orgs with up to, and including, 250 total employees
Microsoft have made two acquisitions recently, both of which show where their focus lies when looking ahead.
Clear Software
Acquired for an undisclosed amount, Clear Software focus on business process solutions that integrate into Oracle and SAP systems. Microsoft have acquired them because their:
“API access and system knowledge will strengthen Microsoft Power Platform’s integration with outside systems and accelerate how customers leverage data and processes that reside beyond Microsoft first-party services”
Microsoft state this will make it easier for users to create Power Apps and Power Automate flows that connect into Oracle & SAP. This will make Power Platform even more attractive to citizen developers across the world and also increase the 3rd-party license non-compliance risks that organisations may face.
and it will be used to power a new module within Microsoft Viva alongside Connection, Insights, Learning, and Topics. The new functionality will also be integrated through Office, Power BI, and the wider set of Microsoft 365 apps.
This is further proof that Microsoft see the Employee Experience (EXP) sector as a big new direction for them and that Viva will likely grow to be a key part of the Microsoft stack.
Microsoft’s latest financial results, those for Q1 FY22 (July – August 2021) are in and – as has been the case for the recent memory – they smashed it again.
Revenue for the quarter was $45.3 billion – a year-on-year increase of 22% and operating income was up 27% to $20.2 billion.
The overall “Microsoft Cloud” area broke $20 billion quarterly revenue for the first time with growth of 36% to reach $20.7 billion. However, Microsoft Cloud gross margin did drop slightly to a mere 71%!
During the earnings call, Satya Nadella said:
“Digital technology is a deflationary force in an inflationary economy”
Which helps explain why the cloud, and technology like Power Platform, keeps growing…they’re helping level the playing field and help smaller organisations grow and compete.
Productivity & Business Processes
This division was up 22% to $15 billion for the quarter, driven by growth in various elements:
Office 365 Commercial was up 23%
LinkedIn was up 42%
Dynamics 365 was up 48%
This is strong growth in several key areas for Microsoft and they don’t believe it will slow down next quarter either.
Intelligent Cloud
Revenue here was $17 billion driven by Azure growth of 50%. The rise of Azure doesn’t seem to be slowing down!
More Personal Computing
Windows OEM was up 10%, despite the ongoing supply chain issues for PCs and laptops…but Surface was down 17%. This is perhaps due to the constraint issues impacting more on higher end devices at the moment.
Other areas of interest
There were various additional statements made during the earnings call including:
Power Platform reaches almost 20 million monthly active users (MAU) – up 76% year-on-year (YoY). Of that, Power Apps makes up 10 million MAU and grew 202% YoY…Nadella states it is in use within 91% of the Fortune 500.
Satya Nadella made several references to the size of organisations that are using products such as Power Platform and Teams – pointing out how many 10,000+ and 100,000+ user organisations are customers.
Microsoft now have over 650,000 customers using their security solutions. How many of those are using more than Defender in Windows 10 would be interesting to see…
Office Commercial licensing decreased by 13%, continuing Microsoft’s ongoing transition of their customer base from on-prem to cloud.
Enterprise Mobility + Security is now at 196 million seats.
Amy Hood revealed that Microsoft have increased headcount by 14% YoY, which is a pretty significant hiring drive.
Microsoft have introduced a new way to help organisations manage their SQL licenses when using Azure Hybrid Benefit – scope-level management.
Scope-level management
Rather than assigning Hybrid Benefit usage at an individual resource level, you tell the Azure portal how many SQL licenses w/SA you have and these are then auto-applied to SQL resources running in the subscription or billing account.
Both SQL Server Standard and Enterprise licenses can be used to off-set costs in Azure but the licenses are “worth” different amounts. In effect, this means that 1 x SQL Server Enterprise license is equivalent to 4 x SQL Server Standard licenses when applying them to Azure services.
Normalized Core Licenses (NCL)
The new concept of NCLs makes it easier to work out how many Azure vCores your on-premises licenses give you. Keeping track of the different licenses and what they equate to in Azure can be confusing so now, when using scope-level management:
1 x SQL Server Standard core license = 1 x NCL
1 x SQL Server Enterprise core license = 4 x NCLs
This means if you have, for example, 6 SQL Standard core licenses w/SA and 9 SQL Enterprise core licenses w/SA you will have 42 NCLs to use across Azure services.
Things to know
You can’t currently use this new centralized management option with:
Azure Data Factory – SQL Server Integration Services (SSIS)
A couple of decent additions this month – new products across EXP (Employee Experience) and Security as well as (some) clarity around support offerings.
Viva new products
Microsoft Viva Insights & Viva Insights Capacity SKUs were added. Not only do we get a new product but we also get a new licensing piece to watch out for…the idea of additional capacity SKUs for Viva Insights analytics. I go into more depth here.
A growing security portfolio
2 x Privacy Management SKUs added – “Risk” and “Subject Rights Request”, furthering increasing Microsoft’s security position. It does, however, look like there was some confusion between “Office 365” and “Microsoft 365” for the pre-requisite licenses as they list “Microsoft 365 E1” which doesn’t exist…yet!
Support info
Microsoft have added a range of information about their support offerings including Unified Support and Premier Support, as well as some of the additional services that are available to purchase. Making this information publicly available will be a big benefit for customers and partners alike, as it hasn’t always been easy to know what was included etc.
A change that snuck past me initially in July is that Microsoft 365 Apps for Enterprise (formerly Office 365 ProPlus) is no longer classed as an “Enterprise Product” and is now an “Enterprise Online Service”. This means it is no longer required to be purchased enterprise-wide.
The Product Terms site now lists a whole host of information about the support offerings that are available through Volume Licensing – with links to supporting documentation too. Finding any information on Microsoft Support has always been surprisingly difficult so this update makes a welcome change!
In this post, I want to look at the information made available by Microsoft and explore what’s on offer. There are two main flavours of Microsoft support, giving access to different services and priced in different ways.
Microsoft Unified Support
This is the latest addition to Microsoft’s support portfolio, introduced in 2019, and Microsoft made a concerted effort to move as many customers as possible from the existing Premier Support (discussed below) to the new Unified Support. This wasn’t a particularly popular move as it generally led to significant price increases for organisations.
First of all, it’s worth noting that Unified Support has a relatively limited reach as it is only available in 22 countries globally:
There are three flavours of Unified Support:
Unified Advanced Base
Unified Performance Base
Unified Enterprise Base
The first two, Advanced and Performance, are governed by the “Support & Consulting Services Description (“SCSD”)” which is available here – while Unified Enterprise is governed by the “Unified Enterprise Support Services Description (“USSD”)”, available here.
What’s included?
Previous information, and in fact the current SCSD, break down Unified Support into 3 options:
Core
Advanced
Performance
but as you can see above, the Product Terms list:
Advanced
Performance
Enterprise
It looks like there has been a change to the levels of support but I’ve not seen an announcement saying as much.
Flex Allowance
Calculated as a percentage of your contract’s list price, this can be used for Proactive services, enhanced services and solutions, Support Technology Advisor, Proactive credits or Custom Proactive Services.
Proactive Services
Although not included with Unified Enterprise, they are all available via Flex Allowance or as a separate, additional purchase.
Unified Enterprise Pricing
Microsoft calculate your “Product Spend” aka “P” which is comprised of:
Cloud services purchases in previous 12 months
Software Assurance purchases in previous 12 months
License only purchases in previous 60 months
and then they price Unified Support as a percentage of that spend. For Azure, it is calculated as:
while for other products it is:
Microsoft state that:
Rates are graduated, so if a customer has $6M in annual Azure spend, it would be calculated as 10% of the first $1.8M and 7% of the next $4.2M ($6M-$1.8M).
So in Microsoft’s example of $6m Azure spend, the Unified Support cost would be:
10% of $1.8m = $180,000
7% of $4.2m = $294,000
Total = $474,000
The publicly available Microsoft documentation doesn’t provide pricing information for the “Advanced” and “Performance” levels but, based on previous information (like this), it will be the same format as above but with lower percentages.
Microsoft Premier Support
Premier Support offerings are detailed in the “Enterprise Services Description of Services” which you can download here. The document gives a pretty thorough overview of all the different services available under Premier Support including:
Architecture services
Digital Advisory
Implementation & Optimization
With the introduction of Unified Support, Microsoft have been working to migrate as many customers as possible across from Premier. However, it is still possible to remain on Premier Support…although it doesn’t appear to be particularly easy.
What’s included?
There are different levels of Premier Support listed in the Product Terms:
although, as mentioned, this isn’t Microsoft’s preferred option anymore.
Optional Enhanced Services & Solutions
Additional paid services are available, these include:
Designated Support Engineering (“DSE”): DSE services are delivered as described in the applicable services description (SCSD or USSD)
Rapid Response services are delivered as described in the applicable services description (SCSD or USSD)
Microsoft Azure Event Management (“AEM”) services (Unified Support only)
Office 365 Engineering Direct services (Unified Support only)
Developer Support services
Support for Mission Critical services (Unified Support only)
You can see this, and more info, in the Product Terms here.
Conclusion
It’s good that Microsoft is making this information available – anything that enables customers and partners to do more research and be better prepared for sales conversations/renewals etc is a good thing. However, it isn’t complete and does seem to contradict some of the longstanding info regarding the support levels etc. so there’s still a fair amount of confusion.
If anyone has anything they can add to this and/or any corrections, please let me know.
Microsoft have released more information about the upcoming Viva Learning via Message Center post MC287944 (that I can’t actually find in there at the moment).
Viva Learning will hit General Availability in “early November” meaning that a new pre-installed Viva Learning app will become available in Teams. A basic Viva Learning subscription will be available free of charge to Microsoft 365 users (the exact licenses are still to be confirmed) and will grant access to:
Microsoft Learn
Microsoft 365 training
125 x LinkedIn Learning courses
There will then be a Viva Learning Premium (expected to be around the $4 pupm mark) that will give features including:
Learning Management System (LMS) integration
Third-party content integration
Additional admin capabilities
and more
As more info becomes available, I’ll be sure to update you!
For more info on Microsoft Viva as a whole – check out my post here.
Microsoft announced this month ( April 2021) that they’ve acquired Nuance Communications for $19.7 billion – their 2nd biggest acquisition behind LinkedIn.
You may be familiar with Nuance for their Dragon Naturally Speaking speech recognition software and/or Power PDF but the focus for Microsoft is their work in the Healthcare sector – much of which is built on Azure. It follows Microsoft’s announcement of their “Cloud for Healthcare” vertical offering and clearly indicates they see it as a growth market for them; they believe it will bring their Total Addressable Market to $500 billion in the healthcare provider space – even a small piece of that will make that $20 billion seem like small change!
Going forward, Nuance will be included within Microsoft’s “Intelligent Cloud” division and Nuance will retain its CEO, Mark Benjamin, who will report into Scott Guthrie – executive vice president of Cloud & AI at Microsoft.
Cloudy with a chance of Licensing 