Fixing Dynamics Licensing: Dynamics 365 App for Outlook


It is a poorly kept secret that Microsoft Business Applications licensing has some problems. This is a shame because the potential for the technology is immense and it is a constant source of frustration for those of us who work with the tools when innovation gets hampered by Microsoft licensing.

The classic problem is internal use rights for things like raising tickets. I mentioned this in my recent Pay-As-You-Go article where the new Pay-As-You-Go plan for Power Apps goes some way to fixing the frustrating solution that is/was Team Member licensing.

In this article I will tackle an issue that is actively preventing organisations moving to the Power Platform. I am sure other Microsoft partners have come across this issue as well and Microsoft needs to make it easier to transition to Power Platform, not harder.

A Common Business Problem

Organisations without a formal CRM system, often cobble together an informal “BONA” system (Business Cards, Outlook, Napkins, Access) to manage CRM activity but, as they grow, they realise they need something more centralised. BONAs work for individuals but make it hard to collaborate among employees and make it hard to get a detailed picture of a customer’s interactions with an organisation.

Activity management (also called Contact Management) is the first step towards managing this. Microsoft used to have the Business Contact Manager and this was then replaced with the Outlook Customer Manager but now there is no formal replacement.

The obvious choice is something built on Microsoft’s Dataverse.

How Dataverse Addresses the Challenge

For the purpose of this conversation, Dataverse is a stripped-down CRM database which applications sit on top of. Those applications can be ones pre-built by Microsoft (Dynamics 365 Modules) configured using the no/low-code Power Platform, or built from scratch with code, connecting to the Dataverse Web API.

Dataverse has a simple set of tables at its core which allow the management of business interactions. These tables include:

  • Accounts (organisations a business interacts with)
  • Contacts (individuals a business interacts with)
  • Activities (out of the box these include meetings, tasks, and phone calls)
  • Notes (and Attachments)

What is more, Microsoft have developed the Dynamics 365 App for Outlook. The description for the app speaks of the Common Data Service (CDS) which is the old name for Dataverse. This app allows a user to push emails, Contacts and meetings to Dataverse so it is centrally managed and visible to the wider organisation. Users can also refer to the information in Dataverse, as they write emails or set up meetings with customers, to see what other employees have done with those customers. The Dynamics 365 App for Outlook is the obvious replacement for the Business Contact Manager, the Outlook Customer Manager, and those BONA setups. We can see activity based on employees, customer contacts, or across entire customer organisations.


The problem comes when we scratch the surface of licensing. Just what do we need to run the Dynamics 365 App for Outlook without running afoul of Microsoft licensing? The AppSource page is not clear, other than saying the product is free.

Fortunately, Microsoft provide lengthy tomes on their licensing. You can find the one for Power Platform here. 32 pages of fun which mentions Outlook three times but not the App. The other licensing guide which can help in these situations is the Dynamics 365 Licensing Guide. Twice the size but it does mention the App.

In short, if you have a Team Member license or a license for a Dynamics 365 Module, you are allowed to use the Dynamics 365 App for Outlook (see the first line in the table below).

So, for a small business dipping their toes into the Power Platform waters, a Team Members license is the obvious choice. It is hard to nail down formal pricing for a Team Member license but you are looking at around US$8 per user per month (compared to US$50 per user per month for Customer Service Pro).

Here is the problem. While Team Members gives us access to the Dynamics 365 App for Outlook, it only gives us read access to the Account table (also in the above table). We get full access to Activities, Contacts, and Notes but Account is the notable exception and the deal-breaker. Microsoft have moved from free tools for Contact Management through to requiring US$50 per user per month to achieve the same outcome.

The other option is to get a Team Members license and a Power App license, given a Power App license gives you full access to the “Core” Dataverse Tables, also known as the standard tables. A license for a Power App is US$5 per user per month. From the Power Platform Licensing Guide:

The combined Team Member + Power App license option may be tempting until we realise that configuring the Outlook App to meet our needs e.g. adding a field to the Contact form which we can see in Outlook is very restricted and described in undecipherable detail in the Dynamics 365 Licensing Guide’s Appendix C. In short, forget it.

With this confused and twisted licensing model, incrementally built up as products have evolved, Microsoft have raised massive barriers to small businesses looking to migrate to Power Platform for Contact Management. Microsoft are driving these organisations to competitors and decimating the organisation’s lifetime value to Microsoft’s bottom line.

I have literally done half a dozen demos of this functionality in the last few months to public and private organisations looking to manage their stakeholder interactions better and, as soon as the conversation comes to price and the insanity of the above licensing, the spark of joy of seeing exactly what they need fades from their eyes and is replaced with a phrase passing their lips around the theme of “<insert expletive> Microsoft licensing!”

The Obvious Solution

In this case, there are two obvious solutions. Option one is to give Team Members full access to those Standard tables in Dataverse, what are called the Common Data Model Core Entities/Tables.

If this was the case, a user would only need a Team Member license for Contact Management using Outlook and Dataverse.

The other option would be to grant Power App licensees access to Dynamics 365 App for Outlook. Then they would only need this license to smoothly transition to the world of the Dataverse. In fact, it could be argued that, with these kinds of adjustments to the Power App licenses, the Team Member license could be scrapped altogether. I am not saying I know Microsoft staff who would break down and cry tears of joy if the Team License disappeared but, if it did disappear, I might be taking a few boxes of Kleenex with me to hand out at the Microsoft offices.

With full access to the App and Dataverse, so many problems go away and the transition for a small business onto Power Platform and Dataverse becomes a simple process. Once there, their use of the services and features of the ecosystem will only increase. Whether it is turning on Dynamics 365 modules, building Power Apps, or making use of the Azure Services which are readily plugged into Dataverse through configuration, Microsoft would see revenue from these otherwise alienated customers and live up to their motto “to empower every person and every organization on the planet to achieve more”.

5 thoughts on “Fixing Dynamics Licensing: Dynamics 365 App for Outlook

  1. App for Outlook can be used with a Power Apps license – it just requires a second Per App pass in addition to the pass needed for the full (custom) Model-driven app. Sure, doubling the cost just for the sake of having a “mini CRM” version inside Outlook may sound a bit strange to a customer. However, at 5+5 USD the total price for the huge potential value one can get from a business application running on Dataverse, it’s not a bad deal.


    • leontribe

      I could find nothing in the Power Platform Licensing Guide confirming this, nor on any Microsoft site. If this is the case, does this mean you need it on top of the Team Member license which is confirmed to give you access to the Dynamics 365 App for Outlook in the Dynamics 365 Licensing Guide?


      • If wouldn’t be a Microsoft product if its licensing terms were clear, now would it? ๐Ÿ˜€

        Microsoft representatives have confirmed several times that running the App for Outlook is supported for Power Apps users. The feature was announced back in June 2019:

        However, explicit statements on licensing requirements in the form of a Licensing Guide have never materlialized. ISVs like RapidStartCRM have used the App for Outlook in combination with Power Apps licenses for a long time. There are documentation steps for how to deploy it in a pure Dataverse environment that doesn’t have any Dynamics 365 components:

        Now, if you do have a Dynamics 365 environment and you’ve got a Team Member licenses for a user, then that should unlock the Outlook side + the limited preconfigured apps targeted for Team Members. By purchasing a $5 Power Apps Per App license, you should be able to build a custom Model-driven app in that environment and grant these same users the full CRUD rights to account table and an unlimited number of other tables, too. However, that combination would be $8 + $5 = $13 with not much benefits over a $5 + $5 Power Apps Per App license combo.

        Sure, you might have scenarios outside Dynamics 365 CE where the Team Member would have limited access to F&O features. Plus the Team Member isn’t environment specific, whereas licensing a test/training environment would require durther Per App passes. Those additional environments might be more economical to license with the new Pay-as-you-go model, though.

        Liked by 1 person

      • I stumbled upon this post today again when I had to search for online evidence to argue with Microsoft sales that “actually, using Dynamics 365 App for Outlook is included in the Power Apps license entitlements”. Since I bet this won’t be the last time I have to answer such questions, I thought I’d make my future self a favor and post a link to one thread on the Microsoft Partner Community forum where the Licensing Concierge eventually makes the confession that it is indeed so:

        What makes things even funnier in the year 2023 is that today we’ve got the Viva Sales app offering an alternative option for email tracking – for customers with Dynamics 365 Sales Enterprise / Premium license. Now that we’ve soon gone full circle with these tools, perhaps Microsoft will one day change the name of the App for Outlook to reflect its role as part of the Dataverse / Power Apps email and appointment tracking core infrastructure.

        Liked by 1 person

  2. leontribe

    Thanks Jukka for digging that out ๐Ÿ™‚ If the Licensing Concierge (what a title!) is confused and did a 180 degree turnaround, I do not feel so bad about my own confusion on what should be a simple user case.


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