Licensing for Microsoft 365 Apps:
- Per-User License: Charged per assigned user.
- Monthly/Annual Payment: Pay monthly or with an annual subscription.
- Access to Office Apps: Includes Word, Excel, PowerPoint, etc.
- 1 TB OneDrive: Comes with OneDrive storage.
- Offline Use: Download desktop versions of Office apps.
Licensing for Microsoft 365 Apps (Formerly Office 365)
Microsoft 365 Apps (formerly Office 365) offer businesses, educational institutions, and individuals powerful tools like Word, Excel, PowerPoint, and Teams.
Licensing these apps correctly is crucial to ensuring your organization has access to the right features at a manageable cost.
In this article, we’ll explore everything you need to know about licensing Microsoft 365 Apps, including the different licensing options, available plans, and best practices to help you make informed decisions.
What Are Microsoft 365 Apps?
Microsoft 365 Apps refer to the productivity tools that Microsoft provides. These include popular software such as Word, Excel, PowerPoint, Outlook, OneNote, and Teams, delivered through the cloud.
By subscribing to Microsoft 365 Apps, users can take advantage of regular updates, improved security, and seamless cloud integration, which allows them to work from almost any device.
Microsoft 365 Apps are available through different subscription models, including Microsoft 365 Business and Enterprise plans.
The subscription-based approach means that organizations can avoid the high upfront costs of purchasing software licenses and instead pay a manageable monthly or annual fee.
Types of Microsoft 365 Apps Licensing
Microsoft offers different licensing models for Microsoft 365 Apps to accommodate various needs.
The three main types of licensing for Microsoft 365 Apps include:
1. Per-User Licensing
Per-user licensing is one of the most popular options for Microsoft 365 Apps. This model is designed for organizations with employees who work on multiple devices or switch between work environments often.
Key Points:
- Single License for Multiple Devices: Each user receives one license, which allows them to install Microsoft 365 Apps on multiple devices. For example, a user can install Microsoft Word, Excel, and other apps on a laptop, desktop, tablet, and smartphone.
- Flexibility: This type of licensing offers flexibility, especially for users who often switch between office and remote work settings. For example, a sales executive who uses a laptop while traveling and a desktop at the office can access their licensed software without additional licenses.
- Cost Efficiency for Hybrid Workers: If employees need access to apps across multiple devices, per-user licensing can be more cost-effective than purchasing separate licenses for each device.
Example:
A marketing consultant named Jane works on a desktop at the office, a tablet at meetings, and a laptop when working from home. With per-user licensing, she can use the same license to access Microsoft 365 Apps on all three devices, providing her with flexibility and cost efficiency.
2. Per-Device Licensing
Per-device licensing is suitable for organizations where multiple users share a single device, such as in schools, public kiosks, or shift-based workplaces.
Key Points:
- Single License for a Shared Device: Each device receives one license, which multiple users can use. This model is ideal for shared workstations in libraries, classrooms, or public areas.
- Cost-Effective for Shared Environments: When different people share the same computer, organizations can opt for per-device licenses instead of buying multiple per-user licenses.
- Limited Flexibility: This option does not provide flexibility for users who need access to multiple devices.
Example:
A school library has several computers available for student use. Instead of purchasing a per-user license for every student, the library opts for per-device licensing, allowing students to use the licensed Microsoft 365 Apps on that shared device.
3. Volume Licensing
Volume licensing is ideal for medium to large enterprises that need multiple licenses and prefer centralized license management. This model is available through Microsoft’s Volume Licensing Service Center (VLSC).
Key Points:
- Suitable for Large Organizations: This type of licensing is generally used by larger companies that need to purchase multiple licenses for many employees.
- Centralized License Management: Volume licensing allows IT administrators to easily manage and track software licenses, making maintaining compliance and optimizing costs easier.
- Discounts Available: Volume discounts are often available, allowing organizations to save on licensing costs.
Example:
A multinational company with 2,000 employees decides to use volume licensing for Microsoft 365 Apps to provide access across the entire organization. This approach allows them to manage licenses centrally and take advantage of volume discounts.
Microsoft 365 Subscription Plans
Microsoft 365 Apps are included in various subscription plans, each catering to different types of users and organizations. Below is a breakdown of the most common plans available:
1. Microsoft 365 Business Plans
Microsoft 365 Business plans are designed for small—to medium-sized businesses with up to 300 users. These plans include various tools to help organizations operate efficiently.
- Microsoft 365 Business Basic: This plan provides access to online versions of Word, Excel, and PowerPoint and email hosting through Exchange. It is ideal for teams that primarily need cloud-based collaboration tools.
- Microsoft 365 Business Standard: This plan includes desktop versions of Microsoft 365 Apps and the online services provided in the Business Basic plan.
- Microsoft 365 Business Premium: This plan adds advanced security features, mobile device management, and other useful tools for businesses that require additional data protection.
Example:
A startup with 50 employees decides to use Microsoft 365 Business Standard. This allows employees to use Microsoft Word, Excel, and other tools online and on their desktops, providing flexibility as the team grows.
2. Microsoft 365 Enterprise Plans
Microsoft 365 Enterprise plans are suitable for larger organizations that require enhanced collaboration and security tools.
- Microsoft 365 E3: This plan includes desktop apps, security features, and compliance tools. It is suitable for most large businesses.
- Microsoft 365 E5: This plan is the most comprehensive, offering advanced security, analytics, and voice capabilities. It is ideal for enterprises that need high security and compliance.
- Microsoft 365 F3: This plan is designed for frontline workers who need access to basic Microsoft 365 services, such as email and cloud storage, without needing full access to desktop apps.
Example:
A large healthcare provider chooses Microsoft 365 E5 for its enhanced security and compliance features. These features allow the provider to protect sensitive patient data while still providing employees with the productivity tools they need.
Licensing for Education, Government, and Nonprofits
Microsoft also offers tailored licensing options for specific sectors, including education, government, and nonprofit organizations.
These plans provide access to Microsoft 365 Apps at reduced prices or with additional features to meet unique needs.
- Education Plans: Microsoft 365 Education offers special pricing for schools and universities, giving students and educators access to tools like Word, Excel, Teams, and OneNote.
- Government Plans: Microsoft 365 Government plans are designed to meet government agencies’ unique compliance and security needs.
- Nonprofit Plans: Depending on the plan and the size of the organization, nonprofit organizations can access Microsoft 365 Apps with discounts or even for free.
Example:
A nonprofit organization that supports community education initiatives uses Microsoft 365 Nonprofit Business Premium to collaborate across teams. This allows staff to use productivity tools like Word and Teams without straining the budget.
Benefits of Licensing Microsoft 365 Apps Correctly
Licensing Microsoft 365 Apps appropriately can provide several significant benefits, including:
- Compliance with Microsoft Policies: By selecting the right licensing option, you can ensure that your organization complies with Microsoft’s licensing requirements, avoiding the risk of costly audits or penalties.
- Cost Optimization: Choosing the right plan and licensing model helps avoid unnecessary expenses. For example, opting for per-device licensing in a shared environment can lead to substantial savings compared to per-user licensing.
- Scalability: Microsoft 365 Apps can be easily scaled up or down, depending on your organization’s needs. Volume licensing, in particular, allows for greater control when expanding operations.
- Flexibility for Different Users: Per-user licenses provide the flexibility needed for remote work, while per-device licenses can help optimize shared workspace environments.
How to Choose the Right Microsoft 365 Apps Licensing for Your Organization
Selecting the right license depends on several factors, such as the number of users, the type of work environment, and the need for scalability and advanced features.
Consider the following steps when choosing the appropriate licensing model:
- Identify User Needs: Determine whether your employees require access to Microsoft 365 Apps on multiple devices or if they primarily work from shared workstations.
- Assess the Environment: Shared work environments, such as libraries or classrooms, may benefit more from per-device licensing, while remote workers may require per-user licensing.
- Consider the Available Budget: Assess your budget to determine whether volume licensing or individual subscriptions are more appropriate.
- Evaluate Security Needs: For organizations that handle sensitive information, Microsoft 365 Enterprise plans like E5 may require added security and compliance features.
Example:
A law firm has 20 lawyers who work on multiple devices and five interns who share office computers. The firm decides to use per-user licensing for the lawyers, allowing them to work seamlessly from laptops, tablets, and smartphones. For the interns, the firm opts for per-device licensing to save on costs since they share a few computers.
Managing Microsoft 365 Apps Licenses
Effective license management is essential for organizations to get the most value from Microsoft 365 Apps.
The following best practices can help you manage your licenses effectively:
- Use the Microsoft Admin Center: The Microsoft Admin Center allows you to assign, reassign, and revoke licenses as needed. This is useful for tracking which users have active licenses and ensuring compliance.
- Regular Audits: Regularly audit your licenses to identify underutilized or expired licenses. This can help your organization optimize costs and avoid paying for unnecessary licenses.
- Centralized License Management: For larger organizations, use Microsoft’s Volume Licensing Service Center (VLSC) to manage licenses centrally, which makes tracking and compliance easier.
Example:
A small IT company regularly audits its Microsoft 365 licenses every quarter. During these audits, it was discovered that a few licenses assigned to former employees were still active. It reassigns those licenses to new employees, helping reduce costs and improve the efficiency of its license management.
Licensing for Microsoft 365 Apps FAQ
What is included in Microsoft 365 Apps?
Microsoft 365 Apps include Word, Excel, PowerPoint, Outlook, and OneNote.
Can I use Microsoft 365 Apps offline?
You can use the apps offline, but they must connect online every 30 days to stay activated.
How many devices can I use with one Microsoft 365 Apps license?
A single-user license allows installation on up to five devices.
Are updates automatic with Microsoft 365 Apps?
Yes, updates are installed automatically as part of your subscription.
Are Microsoft 365 Apps available on mobile devices?
Yes, it is available for both Android and iOS devices.
Can I collaborate with others using Microsoft 365 Apps?
Yes, real-time collaboration is available via OneDrive and SharePoint.
Do I need an internet connection to use Microsoft 365 Apps?
You can work offline, but an internet connection is required to activate and sync files.
What happens if I cancel my Microsoft 365 Apps subscription?
Access to the apps will become view-only, and you won’t be able to edit files.
Can Microsoft 365 Apps be shared with family members?
Yes, family plans allow sharing with up to six people.
Is there a free version of Microsoft 365 Apps?
A free version with limited features is available through Office for the Web.
How are Microsoft 365 Apps different from Office 2019?
Microsoft 365 Apps offers cloud-based access and ongoing updates, unlike Office 2019, a one-time purchase.
Can I switch between different Microsoft 365 Apps plans?
Yes, you can upgrade or downgrade your plan at any time.
Do I get cloud storage with Microsoft 365 Apps?
Microsoft 365 Apps comes with OneDrive storage, with limits varying by plan.
How does licensing work for businesses using Microsoft 365 Apps?
Business plans are licensed per user, allowing installation on multiple devices.
Is technical support included with Microsoft 365 Apps?
Yes, Microsoft provides technical support as part of your subscription.
What will happen to my data if I stop using Microsoft 365 apps?
Your files remain accessible, but editing features will be disabled.
