Managing Dynamics 365 Licensing Costs and Negotiating Microsoft Renewals
A decision guide for teams staring at a much higher Dynamics 365 renewal: your licensing options, how to rightsize seats under the New Commerce Experience, and how to prepare for the negotiation with evidence rather than a bare request for a discount. It also answers the question every Microsoft 365 shop asks first, whether E3 already includes Dynamics 365 Customer Service, and what adding it really costs. If what you need is the short answer to whether there is any legitimate way to bring the bill down, go straight to legitimate ways to reduce your licensing bill.
Facing a steep Dynamics 365 renewal? This guide explains your licensing options (Per App vs. Per User), strategies for rightsizing seats under NCE, and how to prepare for negotiations. We also show how optimizing your implementation can reduce required licenses. Solzet is a Microsoft Dynamics 365 Customer Engagement and Power Platform consultancy headquartered in Yerevan, Armenia, and rightsizing an over-licensed deployment is a routine part of the implementation and project rescue work we deliver. The guidance below reflects how licensing actually maps to roles and usage in the environments we work in, so you can walk into a renewal knowing what you truly need before you talk price. If the question you actually arrived with is whether there is a legitimate way to bring the number down, there is, and the section on legitimate ways to reduce your licensing bill sets out the audit, the negotiation levers, and the license swaps in the order we run them.
Microsoft changes Dynamics 365 SKUs, prices, and program terms regularly, so this guide focuses on the licensing model and the levers you control rather than quoting specific numbers. Always confirm current pricing and rules against your own Microsoft agreement and the latest licensing guide before you commit.
Why the renewal jumped
Introductory or promotional discounts have expired
The pricing on your first term often included a discount that was tied to that term. When it renews, the guide price applies, so the same seat count can cost noticeably more without anything about your usage changing. Knowing which lines were discounted tells you where the increase is really coming from.
Microsoft has raised list prices
Microsoft periodically increases the list price of Dynamics 365 apps. If your renewal spans one of those changes, part of the jump is the new list price rather than anything you did. Separate this portion from the rest so you negotiate against the changes you can actually influence.
Seat counts have grown or drifted
It is common to add users and full licenses over a term without ever reviewing whether each person still needs the license they were given. By renewal the assigned seats can be well above the number of people doing work that genuinely requires a full license, and you renew the drift along with the real need.
Everyone was put on the same full license
When a rollout is in a hurry, teams often assign one broad license type to everyone rather than matching the license to the role. Read only users, occasional users, and single app users then carry the cost of a full multi app license they do not use, and that over-assignment compounds at renewal.
Term and commitment choices lock the cost in
Under the New Commerce Experience the term you commit to and whether you pay monthly or annually affect the rate and your ability to reduce seats mid term. A renewal is the natural point to revisit those commitments, but if you renew on autopilot you also renew whatever term shape you happened to be on.
Your licensing options: Per App vs Per User
Most overspend comes from putting everyone on a full license by default. These are the options to map roles against, from a full Per User license down to app scoped and limited licenses, so each person holds the narrowest license that still does the job.
Full Per User licenses with the base plus attach model
A user who needs full use of a Dynamics 365 app is licensed with a full Per User license for that app. If the same user also needs a second qualifying Dynamics 365 app, that additional app is licensed at the lower attach price rather than a second full license. The lever here is to make sure each person only holds a full license for the app they truly work in and picks up any extra apps as attach licenses, not as a second full base.
App scoped and Per App licensing for narrower roles
Not everyone needs broad access. Users whose work sits inside a single app or a single business process can often be licensed on a narrower, app scoped basis rather than a full multi app license. Where a process is delivered through Power Apps, per app plans can cover users who only ever touch that one application. Matching these users to a scoped license instead of a full one is one of the largest and safest savings available.
Team Members and light or read mostly access
People who mainly read data, update their own records, or perform a few light tasks may qualify for a limited license type such as Team Members rather than a full license. The rules on what a limited license may do are specific and Microsoft enforces them, so this is about correctly identifying genuinely light users, not about relabeling full users to dodge cost.
Power Platform licensing that sits alongside Dynamics 365
Some functionality your users rely on is Power Apps, Power Automate, or Power Pages rather than a Dynamics 365 app, and it is licensed on its own terms. Understanding where a workload actually lives decides whether a person needs a Dynamics 365 license at all or is better served by a Power Platform plan. Getting this boundary right avoids paying for a full Dynamics 365 seat to run what is really a Power Apps workload.
Does Microsoft 365 E3 Include Dynamics 365 Customer Service?
No. Microsoft 365 E3 does not include Dynamics 365 Customer Service, in either the Professional or the Enterprise edition. E3 licenses the productivity and identity suite. Dynamics 365 is a separate product family, bought as an add-on subscription with its own per user licenses, and the same is true of Microsoft 365 E5, Business Premium, and Business Standard. If someone on your team has been budgeting on the assumption that the case management app is already paid for inside E3, that assumption is the first thing to correct.
Owning E3 still changes the economics in your favour, and this is the part most articles skip. Dynamics 365 Customer Service authenticates against the same Microsoft Entra ID and stores content in the same SharePoint and Teams you already pay for, so what you are actually buying is the application and its Dataverse rights, not a second identity, collaboration, and content stack. That is a genuine saving compared with a standalone help desk, but it is a saving on the platform, not a licence you already hold.
What your E3 seats already cover
- •Exchange Online, Microsoft Teams, SharePoint Online, and OneDrive, which is the collaboration and content plane a Customer Service deployment can store documents in and swarm cases through.
- •Microsoft Entra ID (formerly Azure AD) with single sign-on, conditional access, and group-based licensing, which is the same identity Dynamics 365 authenticates against.
- •Office apps, Intune device management, and the compliance and information protection features of the E3 suite.
- •Power Apps and Power Automate use rights limited to customizing and extending the Microsoft 365 apps themselves, which is not the same as rights to Dataverse or a Dynamics 365 application.
What you still have to license separately
- •Dynamics 365 Customer Service, in either the Professional or the Enterprise edition. It is a separate product family with its own per user licenses.
- •Any other Dynamics 365 Customer Engagement app, including Sales, Field Service, and Customer Insights. E5, Business Premium, and Business Standard do not include them either.
- •The Dataverse capacity and premium connector rights that a Dynamics 365 app runs on, which come with the Dynamics 365 seat rather than with E3.
- •The omnichannel add-ons for digital messaging and voice, which are licensed on top of a Customer Service Enterprise seat when you need chat, SMS, social, or an integrated voice channel.
What adding Dynamics 365 Customer Service actually costs
Here is the whole cost picture rather than one headline seat price, so you can build a budget your finance team can check. The figures are Microsoft published US list prices per user per month at the time of writing, before any discount your agreement or partner brings.
| Cost line | What it covers | Typical cost |
|---|---|---|
| Customer Service Enterprise, full agent | Per user, per month. The full license for agents who work cases end to end and need the full app. | About 105 USD list. More than double the price of the E3 seat that same person already holds. |
| Customer Service Professional, lighter agent | Per user, per month. Core case management and knowledge without the Enterprise-only capabilities. | About 50 USD list. Worth pricing properly before you default the whole team to Enterprise. |
| Attach license for a second app | Per user, per month. For a user who already holds a full base license in another Dynamics 365 app. | About 20 USD list, instead of a second full base license. This is the single most missed saving. |
| Team Members, light and read mostly users | Per user, per month. Limited license for people who read records and do a few light tasks. | About 8 USD list, within Microsoft use rights that are specific and enforced. |
| Digital messaging and voice add-ons | Per user, per month, on top of a Customer Service Enterprise seat. Only for agents on those channels. | Priced in the same range as the base Enterprise seat. License the channel agents, not the whole team. |
| Extra Dataverse capacity | Per GB, per month, beyond the tenant entitlement and the per seat accrual your licenses bring. | Usually small at the start and easy to grow into. Attachment and log storage is what moves it. |
| Implementation, one off | Discovery, configuration of queues, routing, SLAs, entitlements and knowledge, data migration from your current desk, UAT, go live and hypercare. | Typically 8 to 16 weeks of delivery effort for a single module SMB rollout. The fee is that effort at your partner rate, best fixed after a paid discovery. |
| Ongoing support and change | Monthly. Release wave updates, new flows and reports, and small enhancements once you are live. | From a part-time consultant, roughly 20 hours a month, up to a managed team. |
| Identity, collaboration, and content platform | Entra ID, Teams, SharePoint, and the governance around them. | No additional cost. You already pay for this in E3, and Dynamics 365 reuses it rather than duplicating it. |
Prices and SKU names change, so treat these as the shape of the budget and confirm the current numbers against your own Microsoft agreement before you commit, as the note at the top of this guide says.
A worked example you can check against your own headcount
Work it through for a support team of 25 full agents and 40 colleagues who only need to read cases and update their own records. Twenty five Customer Service Enterprise seats at about 105 USD is roughly 2,625 USD a month, or about 31,500 USD a year. Forty Team Members seats at about 8 USD is about 320 USD a month, or roughly 3,840 USD a year. That is a license run rate around 35,340 USD a year, plus a one off implementation of 8 to 16 weeks of delivery effort, plus whatever ongoing support you want after go live. Nothing extra for identity, Teams, or SharePoint, because E3 already paid for those. If you had instead put all 65 people on full Enterprise seats, the same deployment would run about 81,900 USD a year, which is the mistake this whole guide exists to prevent.
What you do not pay for twice, because you already run Microsoft 365
The integration benefits are the commercial argument for adding Dynamics 365 rather than a standalone desk, and they are real budget lines you avoid. There is no second directory to provision and deprovision, because Entra ID single sign-on, conditional access, and group based licensing already apply. There is no bolt-on chat integration to build and maintain, because agents collaborate on a case in the Teams they already live in. There is no second document store with its own permissions and backup story, because case documents can sit in SharePoint under the governance you already run. And Dynamics 365 seats carry Power Apps and Power Automate use rights within the licensed application, so the automation around case routing and approvals is not a third product to buy.
We work through those integration benefits in detail, and compare them honestly against a standalone desk, in our guide to Dynamics 365 Customer Service versus Zendesk for Microsoft 365 shops. Read that if the question is which platform to pick; stay here if the question is what the licensing and the renewal will cost you.
Your next four steps before you buy a single seat
Count the agents, not the tenant
Your E3 seat count is not your Dynamics 365 seat count. List the people who will actually work cases, then separate them into full agents, light or read mostly users, and people who already hold a full base license in another Dynamics 365 app and therefore qualify for an attach license. That three way split is the difference between a sensible budget and an over-licensed one.
Price Professional against Enterprise before you default to Enterprise
Customer Service Professional covers core case management and knowledge at roughly half the Enterprise price. Enterprise earns its cost when you need the deeper capabilities, entitlements and routing at scale, or the omnichannel add-ons. Decide which edition each group genuinely needs rather than buying the top SKU for everyone, because that decision compounds at every renewal after this one.
Buy discovery before you buy seats
A short paid discovery gives you the seat mix, the edition, the integration scope, and a fixed implementation price before you commit to a term. It also means the seat counts you sign are the ones you sized, not a guess you will spend the next renewal unwinding. Ask for a fixed price after discovery rather than an open ended time and materials build.
Add the Dynamics 365 term to your existing agreement deliberately
Adding Dynamics 365 mid term under the New Commerce Experience creates a co-term decision: whether the new subscription runs to your existing anniversary or starts its own clock. Align it on purpose so you have one renewal conversation with leverage rather than two smaller ones, and so the rightsizing work in this guide applies to everything at the same date.
Solzet sizes that seat mix and runs the rollout as part of our Dynamics 365 Customer Engagement consulting work, directly or on a white-label basis for other Microsoft partners.
Rightsizing seats and preparing to negotiate
Work through these in order. The early steps establish what you actually use and reclaim what you do not, the middle steps reduce the licenses you need by fixing the build and choosing your commitments, and the last steps turn all of it into a negotiation backed by evidence.
Pull the true picture of assigned licenses versus active usage
Start from the actual assignment data. List every user, the license each one holds, and when they last did work that requires that license. This turns a vague sense that you are over-licensed into a concrete list of seats that are unused, over-specified, or duplicated, which is the evidence every later step and every negotiation depends on.
Map each role to the least expensive license that still does the job
For every role, decide the cheapest license that still covers what the person genuinely does: a full Per User license only where broad app use is real, an attach license for a second app, an app scoped or Per App license for single app users, and a limited license such as Team Members for light or read mostly users. Write the target license next to each person so the gap between what you pay for and what you need is explicit.
Reclaim unused and duplicated seats before you count what you need
Remove or reassign licenses held by people who have left, who never adopted the system, or who hold two overlapping licenses. Do this before you size the renewal, because a renewal quoted against the current inflated seat count anchors the whole conversation too high. The number you want to renew is the number of real, active, correctly typed seats.
Reduce the licenses you need by fixing the implementation
Sometimes people hold a heavier license only because the build forces them to. A clean model driven app, the right security roles, and well placed Power Automate or Power Apps components can let a user do their job on a lighter license, or remove the need for a seat entirely by automating a manual step. Optimizing the implementation is a direct way to lower the license count rather than just re-sorting the seats you have.
Choose term and payment commitments deliberately under NCE
Decide the New Commerce Experience term and payment cadence on purpose. A longer commitment can lower the rate but limits your ability to drop seats mid term, while a shorter or monthly shape costs more per seat but keeps you flexible. Match the commitment to how stable your headcount and roles really are, and keep some portion flexible if you expect change.
Time the changes to land at the renewal date
Sequence the reassignments, downgrades, and seat reductions so they are reflected before or at the renewal, when you can change quantities and license types cleanly. Making the corrections against the renewal boundary avoids paying for a term of seats you already knew you did not need and gives you an accurate baseline to quote from.
Prepare the negotiation with evidence, not just a request for a discount
Walk into the renewal with the numbers: assigned versus active seats, the target license mix, the reductions you have already made, and a clear ask on term and pricing. Whether you renew directly or through a partner, a request backed by a defensible usage analysis and a credible plan is far stronger than asking for a lower price with nothing behind it. If a review shows the platform itself is the wrong fit, that same evidence supports a broader optimization or platform decision.
The last step raises a question this guide deliberately does not answer, which is who you should be buying from in the first place and what they earn on your seats. That is covered separately in our Dynamics 365 licensing and procurement guide on partner versus direct buying and how partner margins work. Read it before a renewal if you are also reconsidering the channel, and read this page for what to cut once you have decided where to buy.
Legitimate Ways to Reduce Your Licensing Bill
Yes, and most of it is ordinary work rather than a trick. A Dynamics 365 bill comes down legitimately in four ways: you stop paying for seats nobody is using, you move each remaining person to the least expensive license that still covers the job they really do, you change the commercial shape of the subscription at a moment when Microsoft rules actually let you change it, and you fix the parts of the build that are forcing people onto heavier licenses than they need. Everything in this section is one of those four. None of it depends on a discount you have to ask for, although a discount is considerably easier to win once the rest has been done.
First, where the line is
Every one of these gets suggested in a renewal conversation, and every one of them costs more than it saves. Worth naming before the useful part, because a saving that fails a later review is a saving you repay with the goodwill spent arguing about it.
Relabeling full users as Team Members
Team Members use rights are narrow, specific, and enforced through the app modules Microsoft designates for that license. Moving someone who closes cases or edits other people's records onto a limited license is not rightsizing, it is a liability that surfaces at the next true-up with the saving owed back. Move the people who genuinely qualify, and document why each one qualifies.
Sharing one login between several people
Dynamics 365 is licensed per named user, and the multiplexing rules mean that routing several people through one account, a shared kiosk, or a middleware layer that hits Dataverse on their behalf still requires a license for each of them. Where several shift workers genuinely share a workstation, check whether a device based license exists for the app in question rather than sharing a named account.
Leaving premium connector and custom code usage undeclared
Flows and apps using premium connectors, custom connectors, HTTP actions, or Dataverse from outside a Dynamics 365 app carry their own license requirement. Not knowing about them is a common position; hoping nobody looks is an expensive one. Find them yourself, because the alternative is finding them during a renewal review with no time to remediate.
Cancelling and repurchasing to reset an expired discount
Introductory and promotional pricing is generally tied to a first purchase and a term, so tearing down a subscription to buy it again rarely reproduces the old rate and reliably creates a gap in service and an argument about data. Treat the expired discount as information about where your real price sits, then negotiate from evidence instead.
Starting the work after the renewal has landed
This is the most common and the most costly mistake, and it is not even a rules question. Once an annual term renews you generally cannot reduce quantities until the next boundary, so a rightsizing finished a week late is a rightsizing you pay full price for over another whole term. Timing is not a tactic here, it is the substance.
The audit: finding the unused and the over-specified seats
The reason most internal rightsizing efforts stall is not that the data is unavailable, it is that assignment data, sign-in data, in-app usage data, and Dataverse activity sit in four different admin surfaces with nothing that joins them cleanly. This is the order to do it in, with the surface to pull each piece from. Allow a couple of days for a single-app estate and a week for a tenant nobody has audited before.
Build one row per person, not one row per subscription
Start in the Microsoft 365 admin center. Export the subscription list with purchased quantity, assigned quantity, term shape, and term end date, then export the assigned users for each Dynamics 365 and Power Platform product. Pivot the result so you have a single row per named person carrying every license they hold. Two savings fall out before you have looked at usage at all: purchased quantity minus assigned quantity is seats you are paying for that are attached to nobody, and any person holding two full base licenses is a candidate for the attach price on the second app. Neither requires a conversation about anyone's job.
Join that sheet to evidence of use, not to a manager's opinion
Add three columns per person. Last interactive sign in, from the Entra ID sign-in logs. Last activity in the Dynamics 365 app itself, from the environment and app usage analytics in the Power Platform admin center, which also show you which app modules each person actually opens. And, where you need something you can defend line by line, a last-touch date per user from Dataverse: the most recent created or modified record they own, or their audit history if auditing is on. Fix the threshold before you look at the data, because a rule applied to everyone survives the conversation that follows. Ninety days of no qualifying activity is a reasonable line for an annual renewal.
Sort every person into one of five buckets
Full base, for people who genuinely work across a Dynamics 365 app end to end. Attach, for people who already hold a full base license in one app and need a second qualifying app at the lower attach price rather than a second full base. App scoped or Per App, for people whose entire working life is one app or one process, including workloads that are really Power Apps. Team Members or equivalent light license, for people who read records, maintain their own, and take part in a process, tested against the published use rights rather than against how busy they look. And no seat at all. Write the target bucket next to every name, then total the sheet by bucket. That total is your renewal number, and the gap between it and what you hold today is the size of the prize.
Strip out the accounts that should never have been a paid seat
Before you total anything, remove what was never a user. Leavers still holding an assignment because offboarding removed the mailbox but not the Dynamics 365 license. Integration and service accounts, where an application user or the small allowance of non-interactive accounts does the job instead of a standard paid seat. People who hold the same entitlement twice, once through group based licensing and once assigned directly. Test, training, and demo accounts left over from the implementation. And external customers, partners, or contractors sitting on internal seats when what they need is a portal. Each of these is a clean cut with no operational argument attached to it, which is why they are worth doing first.
Check what you already own before you buy a single add-on
Add-on capacity is routinely bought to avoid cleanup that nobody has scheduled. Open the capacity page in the Power Platform admin center and read database, file, and log storage separately by environment against the tenant entitlement and the per seat accrual your existing licenses bring. Audit history, plug-in trace logs, expired asynchronous job records, and email attachments are usually most of the growth, and deleting them is cheaper than renting space for them. The same logic applies to functionality: Dynamics 365 seats carry Power Apps and Power Automate use rights within the licensed application, so check the boundary before buying a standalone plan for automation that sits inside the app you already license.
Turn the sheet into a dated change list against the renewal boundary
Split every proposed change into three columns. Changes you can make now, meaning unassignments, reassignments, and cleanups that need no permission from Microsoft and no build work. Changes that must wait for the renewal date, meaning quantity reductions, edition swaps, license type changes, and term shape. And changes that are blocked behind a build fix, meaning the people who cannot move to a lighter license until something in the system is rebuilt. Put a date and an owner on each line, work backwards from the term end date, and take the totals into the renewal conversation as your position rather than your hope.
The negotiation levers that actually exist under the New Commerce Experience
The New Commerce Experience narrowed what you can change and when, which means the levers that remain are mostly about timing, term shape, and who is quoting you. These are the ones with a real mechanism behind them rather than a hope that somebody will be generous. Program terms change, so confirm each against your own agreement before you rely on it.
Stop the automatic renewal at the current quantity
New Commerce Experience subscriptions renew automatically at the quantity you are holding. That single default is responsible for more overspend than any pricing decision, because a renewal nobody touched is a renewal of every seat that drifted in over the term. Put the term end date in a calendar with a reminder several weeks ahead, and treat the audit above as work that has to finish before that date rather than work that happens when someone gets to it.
Protect the short window at the start of the term
The New Commerce Experience allows cancellation and seat reduction only inside a short window measured from the start or renewal of a term, seven calendar days at the time of writing. After it closes, an annual term lets you add seats but not remove them until the next renewal. Confirm the current window against your own agreement, then treat it as the one date that genuinely cannot be recovered if you miss it. Everything you want to reduce should be decided before the term starts, not discovered inside it.
Price the term shape as a decision instead of accepting one
A monthly term costs more per seat than an annual term and buys you the ability to reduce every month. A longer commitment lowers the rate and locks it for the term while removing that flexibility. Most estates are put wholesale onto one shape and therefore either overpay for flexibility they never use or lose flexibility they badly need. Split it: commit the stable core headcount on the longer term at the better rate, and keep the seasonal, project, or genuinely uncertain portion on a monthly shape you can drop.
Co-term everything onto one anniversary
Subscriptions bought at different moments renew at different moments, which means you never have the whole number on the table at once and neither does anyone quoting you. Aligning the end dates gives you a single renewal conversation carrying the full annual value, and full annual value is what any concession is measured against. It also means the audit runs once a year against everything rather than piecemeal against whichever subscription happens to be expiring.
Get a competing quote before you speak to the incumbent
In the CSP channel the partner sets your price, which means the price is genuinely negotiable and a written quote from a second partner for the identical SKUs and quantities is the most direct pressure available. Subscriptions can be transferred between partners at the renewal boundary. While you are asking, ask what the margin is buying: named support hours, license management, escalation into Microsoft, or nothing beyond the invoice. A partner delivering real service is worth paying, and one that is only rebadging list price should be priced accordingly.
Make a specific ask, in writing, with the evidence attached
Send the quantity by license type, the term shape, the effective date, and the analysis that produced them. Asking whether someone can do better on price invites a token response, because there is nothing in the request to respond to. A documented reduction from a real usage audit, presented as the number you intend to renew rather than an opening position, changes the conversation from discounting to keeping the account.
Use the other side's calendar as well as your own
Microsoft runs a fiscal year ending in June with quarters closing in September, December, and March, and the incentive pressure on the selling side is real at those boundaries. If your renewal already sits near one, that is leverage you did not have to create. If it does not, a deliberate term change is one way to move a future renewal closer to a point where the person quoting you has a reason to move.
Feature rightsizing: the swaps, and what each one costs you
A downgrade recommended without naming what it takes away is how a rightsizing becomes a rollback three months later. Each row below gives the move, who it genuinely fits, what you give up, and the check to run before you commit to it. Work down the list in order: the attach swap is usually the biggest and the least disruptive, and the Team Members swap is the one that needs the most care.
| The move | Who it fits | What you give up | How to check before you commit |
|---|---|---|---|
| Customer Service Enterprise to Customer Service Professional | Agents doing core case management and knowledge inside one team, with straightforward assignment and no channel work. | The Enterprise-only capabilities, including the deeper routing, entitlement and service scheduling machinery, and the ability to attach the digital messaging and voice add-ons, which require an Enterprise seat. | List the Enterprise-only features actually configured in your environment, then check the usage data for who touches them. Features that were configured during the implementation and never adopted are not a reason to keep the edition. |
| Sales Enterprise to Sales Professional | Teams running an ordinary opportunity pipeline with standard forecasting expectations and modest customization. | The Enterprise capabilities around forecasting and sales acceleration, and the higher customization ceilings, since the Professional edition caps custom tables, forms, and related objects. | Count the custom tables and forms in the app against the current Professional limits, and confirm whether anyone is genuinely running forecasts rather than exporting to a spreadsheet. |
| A second full base license to an attach license | Anyone who holds full licenses for two Dynamics 365 apps while only needing full rights in one of them. | Nothing functional, provided the person keeps a qualifying full base license for their primary app. The attach license grants full use of the additional app. | The per person pivot from step one of the audit above. This is usually the largest single line on the sheet and the least disruptive to execute, which is why it belongs at the top of the list. |
| A full license to Team Members | People who read records, maintain their own, and take part in a process, and who do so through the app modules designated for the license. | A great deal. The use rights are narrow and enforced, and this is the swap that becomes a compliance finding when it is applied optimistically rather than carefully. | Watch what these people actually do for a fortnight using the activity data, not what their job title suggests. If they close cases, edit records they do not own, or work in the full app, they are not Team Members. |
| A Dynamics 365 seat to a Power Apps per app plan | Users whose entire workload is a custom Dataverse application that happens to live next to the CRM rather than the Dynamics 365 application itself. | Access to the Dynamics 365 app and to the restricted Dynamics 365 tables, which a Power Apps license does not grant no matter how the app is built. | List every table the app reads and writes and compare it against the restricted table list in the current Microsoft licensing guide. One restricted table anywhere in the app puts the user back on a Dynamics 365 seat. |
| External users on internal seats to a portal | Customers, partners, contractors, and applicants who need to submit, track, and update a small number of their own records. | Direct access to the internal application, and the build effort of the portal itself, which is a project rather than a licensing change. | Count the external named users currently holding internal seats. Power Pages is licensed on authenticated and anonymous capacity rather than per internal user, so the arithmetic changes shape entirely once the external population is large. |
| Channel add-ons across the whole team to only the agents on those channels | Any deployment where digital messaging or voice was bought broadly at rollout because it was easier than deciding who needed it. | Nothing, for the agents who were never queued into a channel in the first place. | Pull the queue and channel configuration and list the agents actually routed into chat, SMS, social, or voice. Compare that list against who holds the add-on. |
| Add-on storage capacity to a cleanup you keep postponing | Tenants that have bought incremental Dataverse capacity while audit history, trace logs, expired job records, and attachments accumulate untouched. | The retention you actually delete, so decide the retention policy deliberately and keep what compliance requires. | The capacity page in the Power Platform admin center, read as database, file, and log separately by environment. Log capacity growing faster than database capacity almost always means audit or trace settings rather than real business data. |
Edition feature matrices and use rights change between releases, so treat each row as the shape of the decision and verify the current boundary in the Microsoft licensing guide and your own agreement before you swap anybody, as the note at the top of this guide says.
How Solzet runs this as a health check, and what the roadmap looks like
Everything above is work you can do yourself, and if you have the time and the admin access you should. Where teams ask us to run it, it goes through our Dynamics 365 health check and technical audit, because the licensing question and the build question are the same question seen from two sides. That page covers the full assessment scope and why an independent read is worth paying for; what follows is only the cost slice of it, step by step.
Fixed scope and read access, agreed before anything starts
We agree which environments and which subscriptions are in scope, and the price is fixed before we look at anything, so nothing in the report earns us more by being alarming. For the licensing slice specifically, read access means the billing and license reports in the Microsoft 365 admin center, the Power Platform admin center including the capacity and analytics pages, the Entra ID sign-in logs, and a read-only security role in each Dataverse environment. Nothing is changed in your system while we look.
We build the per person picture, with the joins already done
You get the sheet the audit above describes, assembled for you: one row per named person, every Dynamics 365 and Power Platform license they hold, last sign in, last real activity in the app, the modules they actually open, and a proposed bucket of full base, attach, app scoped, light, or none. This is the artifact everything else rests on, and it is also the point at which most internal efforts stall, because the four data sources behind it sit in four different admin surfaces with no shared key that lines up cleanly.
We separate a licensing problem from a build problem
Where somebody needs a heavier license only because the system makes them touch something they otherwise would not, that is a build finding rather than a licensing finding, and it is worth more than the seat. Security roles granting well beyond what the role needs, custom tables sitting inside a Dynamics 365 app when they could live in a Power Apps one, a manual step keeping a seat alive that an automation would remove. This is exactly where the licensing audit benefits from running inside the wider assessment, alongside the configuration, security, and performance dimensions, rather than as an isolated spreadsheet exercise.
We price the compliance exposure in the same pass
Premium and custom connector usage without the license behind it, external users on internal seats, multiplexing patterns introduced by an integration nobody documented, and environments holding production data that nobody owns. Finding these yourself, months before a renewal, is dramatically cheaper than having them found for you during one. We report what would fail and what it would take to fix, and because the fee is fixed and we did not build the system, there is nothing for us to defend on either side of that finding.
You get a cost optimization roadmap in three horizons
Recoverable now: the unassignments, reassignments, duplicate cleanups, and retirements that need no build change and no renewal boundary, with the annualized value of each. Recoverable at the renewal: quantity reductions, edition and license type swaps, and term shape changes, each with the date it has to be executed by and the evidence attached to it, so the sheet doubles as your negotiation pack. Recoverable after a build change: the seats that are blocked behind remediation, each with an effort estimate against the licensing saving it unlocks, so you can see which fixes pay for themselves and which do not. Every line is rated by impact and effort, like every other finding in the assessment.
You own the roadmap and can execute it with anyone
The report is written to be run by your own team, by your incumbent partner, or by us, and it is specific enough to be actioned rather than admired. If you want Solzet to deliver the remediation, we scope that separately as consulting work, but the assessment is the product and it stands on its own whether or not anything follows it.
If the roadmap says the seats are blocked behind a build change, the remediation itself is ordinary Dynamics 365 and CRM development work and we scope it separately, directly or on a white-label basis for other Microsoft partners. The assessment stands on its own either way.
Frequently Asked Questions
Why did my Dynamics 365 renewal come back so much higher?
A steep renewal is usually a combination of a few things rather than one. Introductory or promotional discounts from your first term expire and the guide price applies, Microsoft may have raised list prices in the meantime, and seat counts often drift upward over a term as users are added without review. On top of that, teams frequently assign one broad full license to everyone, so read only and single app users carry the cost of access they do not use. Separating these causes tells you which part of the increase you can actually negotiate and which part is simply the current list price.
Is there a legitimate way to bring our Dynamics 365 licensing bill down?
Yes, and almost all of it is ordinary work rather than a loophole. There are four legitimate levers. Stop paying for seats nobody uses, which means joining your license assignment export to real sign-in and in-app activity data and reclaiming leavers, duplicate assignments, service accounts, and dormant users. Move each remaining person to the least expensive license that still covers their real job, which usually means an attach license instead of a second full base, an app scoped or Per App license for single app users, and a limited license such as Team Members only for people who genuinely qualify under the published use rights. Change the commercial shape at a moment when the New Commerce Experience actually permits it, since an annual term lets you add seats but not remove them until the renewal boundary. And fix the parts of the build that force people onto heavier licenses than they need. What does not work is relabeling full users as Team Members, sharing logins, or leaving premium connector usage undeclared, because those are enforced and surface later as a true-up.
What is the difference between Per App and Per User licensing in Dynamics 365?
A full Per User license grants a user broad use of a Dynamics 365 app, and under the base plus attach model a second qualifying app for the same user is added at a lower attach price rather than a second full license. App scoped or Per App licensing covers users whose work sits inside a single app or process, at a lower cost than a full multi app license, and where a workload runs on Power Apps a per app plan can cover a user who only touches that one application. The practical point is to give each person the narrowest license that still does their real job, rather than a full license by default.
Does Microsoft 365 E3 include Dynamics 365 Customer Service?
No. Microsoft 365 E3 does not include Dynamics 365 Customer Service in any edition. E3 licenses the productivity and identity suite, Exchange Online, Teams, SharePoint, OneDrive, the Office apps, Intune, and Microsoft Entra ID, while Dynamics 365 is a separate product family bought as an add-on subscription with its own per user licenses. Microsoft 365 E5, Business Premium, and Business Standard do not include it either. Owning E3 does change the economics, though: Customer Service runs on the same Entra ID, Teams, and SharePoint you already pay for, so you are buying the application and its Dataverse rights rather than a second identity, collaboration, and content stack.
How much does it cost to add Dynamics 365 Customer Service to Microsoft 365 E3?
Budget three things: seats, implementation, and ongoing support. At Microsoft list prices at the time of writing, a full Customer Service Enterprise seat is about 105 USD per user per month, Customer Service Professional about 50 USD, an attach license for a user who already holds a full base license in another Dynamics 365 app about 20 USD, and a Team Members license for light or read mostly users about 8 USD. A team of 25 full agents and 40 light users is therefore roughly 35,000 USD a year in licenses rather than the roughly 82,000 USD you would pay by putting all 65 people on full Enterprise seats. On top of that, a single module implementation for a small or mid-sized business is typically 8 to 16 weeks of delivery effort covering discovery, configuration, data migration, testing, and hypercare, priced as that effort at your partner rate and best fixed after a paid discovery. Confirm current prices against your own Microsoft agreement before you commit.
How do I rightsize Dynamics 365 seats under the New Commerce Experience?
Start from real data: list every user, the license they hold, and when they last did work that requires it. Map each role to the least expensive license that still covers the job, reclaim unused and duplicated seats, and, where the build is forcing a heavier license than needed, fix the implementation so a lighter license suffices. Then choose the New Commerce Experience term and payment cadence deliberately, since a longer commitment can lower the rate but limits mid term reductions, and time the changes to land at the renewal date so you renew only the seats you genuinely need.
How do I tell whether a user needs a full license, an attach license, or Team Members?
Test each person against what they do rather than what their title suggests, using activity data. A full base license is for someone who works across a Dynamics 365 app end to end. An attach license is for someone who already holds a full base license in one app and needs a second qualifying app, which is the lower priced option and the most commonly missed one. An app scoped or Per App license covers someone whose entire working life is a single app or process, including workloads that are really Power Apps rather than a Dynamics 365 app. Team Members is for people who read records, maintain their own, and take part in a process, and its use rights are narrow and enforced through the app modules Microsoft designates for it, so it is not a cheaper way to license a full user. The practical method is to build one row per named person carrying every license they hold, add last sign in, last in-app activity, and which modules they open, then assign a target bucket to every name and total the sheet by bucket.
Can optimizing our implementation actually reduce the licenses we pay for?
Yes, and it is one of the more durable ways to lower cost. Users are sometimes on a heavier license only because the build makes them touch functionality they would not otherwise need, or because a manual step keeps a person in the system who could be replaced by automation. A cleaner model driven app, correct security roles, and well placed Power Automate or Power Apps components can let people work on a lighter license, and automating a manual step can remove the need for a seat entirely. Fixing the implementation reduces the underlying license requirement rather than just re-sorting the seats you already hold.
How does a Dynamics 365 health check find licensing savings?
The licensing audit runs as a slice of the wider Dynamics 365 health check, on a fixed price agreed before we start and with read-only access. We pull the license assignment and subscription data from the Microsoft 365 admin center, the usage and capacity data from the Power Platform admin center, sign-in data from Microsoft Entra ID, and last-touch activity from Dataverse, then join them into one row per named person with a proposed license bucket beside each name. We separate a licensing problem from a build problem, because someone who needs a heavier license only due to how the system was built is a build finding worth more than the seat. We also price the compliance exposure, meaning premium connector usage without the license behind it, external users on internal seats, and multiplexing patterns. The deliverable is a cost optimization roadmap in three horizons: what is recoverable now with no build change and no renewal boundary, what is recoverable at the renewal with the date and evidence attached to each line, and what is recoverable after a build change with the effort estimated against the saving it unlocks. You own the roadmap and can run it with your own team, your incumbent partner, or us.
How should I prepare for a Microsoft renewal negotiation?
Arrive with evidence rather than a bare request for a discount. Bring the assigned versus active seat analysis, the target license mix by role, the unused and duplicated seats you have already reclaimed, and a clear ask on term and pricing. Decide in advance which commitment shape under the New Commerce Experience fits how stable your headcount really is. A renewal backed by a defensible usage analysis and a credible plan is far stronger than asking for a lower price with nothing behind it, whether you renew directly or through a partner.
Can Solzet help us reduce Dynamics 365 licensing costs before a renewal?
Yes. Solzet is a Dynamics 365 Customer Engagement and Power Platform consultancy based in Yerevan, Armenia, and rightsizing over-licensed deployments is part of our implementation and project rescue work. We review assigned versus active usage, map each role to the least expensive license that still fits, reclaim unused and duplicated seats, and where the build is driving licenses higher than needed we optimize the implementation so lighter licenses or fewer seats suffice. We work directly with in house teams or on a B2B and white-label basis for other Microsoft partners.
Renewal jumped and you need to know what you really need?
Solzet reviews assigned versus active usage, maps roles to the least expensive license that still fits, and optimizes the implementation so you need fewer and lighter seats, all as part of our Customer Engagement and Power Platform delivery. Tell us where the cost is and we will help you walk into the renewal with the numbers, directly or on a white-label basis for your team.