Microsoft Power Platform is a basket of tools and services that helps you and your workforce create custom business solutions. These low or no code tools are designed to be “citizen-led”. This means you don’t need to be a coder to use them. Power Automate and Power Apps are popular tools in the suite. They help SMEs achieve big business wins in productivity, however, the Power Platform licensing model is time-consuming and complex to navigate.
There are various types of licences for Power Platform and these vary depending on which tools from the suite you want to use. Understanding which licenses are best for your requirements can be confusing. Microsoft’s January 2023 Power Platform Licensing Guide is 31 pages long and can be difficult to understand, even for Microsoft Partners. We’ve tried to simplify this for you, focusing on Power Automate and Power Apps.
To understand the licensing model for Power Apps and Power Automate, you need to understand the role Microsoft data connectors play. A data connector is a tool that allows different applications to communicate and share information with each other. There is a wide range of pre-built connectors already available within the Power Platform that allow you – without coding or dev skills – to connect to commonly-used services.
Connectors within the Power Platform fall into three categories: Basic, Premium and Custom Connectors. Premium and Custom connectors cost more so you will need to think about what you need your data connectors to do. Think of them as buses or trains that transport people from city to city; these data connectors move data between applications in the same way.
Basic Connectors are like local public buses that take you to different places within the same city. They are pre-built connectors that come with the Power Platform and allow you to connect with popular apps like Outlook, SharePoint, and Twitter. They are included in a number of Microsoft 365 licenses so you may not need to pay extra to use them.
Premium Connectors are like express trains that take you to farther destinations, faster than the bus. They are specialized connectors provided by Microsoft that allow you to connect with more complex applications like Microsoft SQL Server, HubSpot, Salesforce, or Adobe. Premium connectors cost more and you need a specific license to use them.
Custom Connectors are like private cars that can take you to any destination you want, even if it’s not on the usual bus or train route. They are connectors that you can build yourself (or have a third-party build for you) to connect with any application or service that has the ability to do so.
Power Platform is rapidly evolving and Microsoft is constantly adding new bus and train routes. If a connector for your line of business application does not exist, you can arrange for a third party/Microsoft Partner to create one for you. Microsoft encourages you to create custom connectors.
Once you’ve decided which type of data connectors you need, you can look at how to pay for them. This is where the different licensing models come in to play. Licenses for the Microsoft Power Platform are available either as standalone licensing plans or as seeded licensing plans. Choosing which option you need comes down to whether you need to catch the bus, an express train or a private car.
If your business has existing Microsoft 365 licenses it is likely that your staff already have access to the bus through a seeded licensing plan. Seeded licensing plans refer to pre-defined licenses; you can think of them as bundles. These licenses are created and assigned automatically to certain types of users or groups and are a simple way to manage access to the platform and allow users to work within pre-defined limits.
A common example of a seeded license plan is a Microsoft 365 Business Premium license. As part of this license, users can catch the bus – and by that we mean create applications and automated workflows that connect to those basic data sources we discussed earlier.
Buses (or basic connectors) are a great option if you are starting your automation journey with a simple project, so make sure to check if your existing M365 license gives you access to them. If you are unsure, your licensing provider should be able to confirm this for you.
A standalone licensing plan refers to a license that is purchased separately for a specific Power Platform tool, rather than as part of a seeded license (bundle). You should purchase standalone licensing plans when you want to use the express train (Premium Connectors) or a private car (Custom Connectors). These connectors help you make the most of all the features that the Power Platform has to offer and therefore come at an extra cost. There are three standalone licensing plans for Power Apps and for Power Automate:
A ‘per user’ standalone plan allows the user to create and run unlimited apps or flows and use all the connector options. It is charged per user per month. Think of this as unlimited rides on any express train or private car journey for a particular staff member.
A ‘per app’ or ‘per flow’ standalone plan allows an unlimited number of people within your business to use the app or flow regardless of the connector type. Think of this as all of your staff being able to take unlimited rides on an express train or private car to a set destination. It is charged per app/flow per month.
Pay-as-you-go standalone plans allow you to pay every time a flow or app with a premium or custom connector is used. Think of this as like paying for an individual ticket each time you use the express train or private car.
Selecting the right licensing plan largely depends on how many staff you have using power platform solutions at any given time. As your adoption of Microsoft Power Platform evolves, your solution plan will change.
The features and functionalities within each license plan may change over time so it’s always best to check with Microsoft’s official documentation or consult with a Microsoft Partner like us here at Ziptech. We can help you to choose the best plan for your requirements. We can also help you to understand how the licensing works for the other tools in the suite such as Power Virtual Agents, Power BI and Power Pages.
The information we have provided above is based on Microsoft’s January 2023 Power Platform licensing guide. We have purposefully not listed specific license costs because Microsoft reserves the right to change these prices in the future.