Recent changes to Microsoft 365 licensing for Power Apps and Power Automate have caused a lot of confusion for our clients, and we have spent a significant time understanding and explaining the changes and requirements to help them better understand their licensing needs. Below, we have tried to explain the changes in plain language, to make it as easy as possible for you to plan your licensing needs, based on what you are currently using.

First things first, if you are currently using Plan 1 or Plan 2 licensing for Power Apps and Power Automate, once those renew you’ll need to replace them with the new standalone licensing plans.

For most of you who are running Power Apps or Flow Plan 2 for the administrative features, you can go straight to Power Apps per user plan, or Power Automate per user plan, respectively. This will be the only licensing plan that will deliver everything you currently have, including the use of model-driven apps, premium connectors, and environment creation and management.

For everyone else happily building away using the included Power Apps and Power Automate licensing included with your Office 365 (Microsoft 365) license, continue on, and nothing will change in your world.

Power Automate Per User Licensing

This one is pretty straight forward, consider this to be “Premium” Power Automate. It allows a user to:

• User premium connectors
• Leverage the administrative functions in Power Automate
• Have all the benefits of increased runs, and faster automated triggers
• ~1 minute checks for changes instead of 15 minutes
• ~Ability to run scheduled flows on a smaller time interval

Power Apps Standalone Licensing

The Power Apps licensing gets a little more confusing, since they cover three different models. In brief:

Per User

Higher monthly cost per user. Allows for unlimited app creation, and premium connectors. Also allows for the management of environments and other administrative functions.

Per App

Lower monthly cost, and is basically used to grant use rights to Power Apps that use premium connectors.

Portals

Portals are meant to provide an interaction point for external users. To run a Portal, you’ll likely need a combination of Per User and Per App licensing, as well as some additional add-ons for authenticated logins and page views.

Sample situation

I need to set up a Portal for our 500 frontline employees to create a profile and manage personal information in a secure fashion. The Portal should allow our employees to log in securely, review tasks that have been assigned to them, and submit information to our HR team. Our frontline employees haven’t been assigned Microsoft 365 licenses, so this presents a problem for bringing them in and securely authenticating them as external users. Licensing all of those users at $6/user/mth will cost the company $3000/month, or $36,000/year.*

Using Power Apps Portals, I can enable this scenario with the following licensing**:

1 User – Power Apps Per User Plan - $50/mth

This will provide a “service account” used to create and publish the Portal. This will allow for the use of the Common Data Service for data storage, and the management of environments so that development and release cycles can be managed, and data can be secured through Data Loss Prevention (DLP) policies.

5 Users – Power Apps Per App Plan - $50/mth (based on 5 users @ $10/user/mth)

This licensing will allow 5 users in my organization to use the Portal, to review information, assign tasks, etc. In this example scenario, this might be the HR department at my company.

External Login Capacity, and Page View Capacity - $300/mth

This will provide 100 authenticated logins a month (a user authenticating multiple times in 24 hours is still one login) and 100,000 page views. Here, we are assuming that 100 logins will suffice on a monthly basis for those 500 employees. Additional capacity can be purchased as needed.

The total licensing cost for this solution, based on this model would be $400/mth * 12 months for a total of $4800, a significant savings over the idea of licensing each of those frontline employees. ***

Important note:

With the licensing structure above, your maximum database size will be limited to 500 MB, which isn’t going to get you very far in a high-volume system. This is another reason why you want to make very sure you have considered all aspects of the solution you are trying to implement  before you start.

*Cost approximated based on basic Microsoft 365 licensing at retail costs.

**Minimal Licensing used, for example purposes. Proper requirements should be gathered, and the full short and long term needs for your solution should be assessed prior to a final solution structure inclusive of licensing being determined.

***It should be noted, again, that this is using example pricing and minimal licensing to calculate. Considerations for volume pricing discounts, Enterprise Agreements, etc are not applied.

We hope that this post has gotten you started on unraveling and understanding the Power Apps licensing model, and we’d be happy to help you determine the right structure and platform for your next business application.