Big Changes Coming to Microsoft Dynamics GP Licensing

Written By: Eric Gjerdevig

from July 10, 2012

Today at the Microsoft Worldwide Partner Conference (WPC) held in Toronto, Canada, Microsoft announced significant changes to the pricing structure around Microsoft Dynamics GP and Microsoft Dynamics NAV. This article will share as much of the information that was provided. Watch for a part 2 of this same article with more details as they are made available.

This new licensing model comes into full effect later this year when the 2013 version of both products launch (calendar Q4) but there are some immediate impacts and things to be thinking about. The following will focus on the Microsoft Dynamics GP changes but most of these also apply to Microsoft Dynamics NAV.

Microsoft Dynamics GP 2013 will be launching in Q4 2012 with an extremely simplified pricing and licensing model optimized for small and midsized businesses. Microsoft Dynamics GP 2013 will only be available via the new licensing model so Microsoft is introducing a transition upgrade policy to simplify the licensing requirements for existing customers that want to upgrade to the latest version of the product.  As per current policy, customers need to be active on the Business Ready Enhancement Plan in order to benefit from upgrade rights.

The new pricing is VERY simple. All new customers starting with Microsoft Dynamics GP 2013 will start out by buying the Starter Pack. The Starter Pack includes 3 Full users. It is focused around the Financials and Distribution modules within Dynamics GP. The price of the Starter Pack is $5,000. Customers who need some of the advanced functionality such as Manufacturing (and numerous other modules) will need to buy the Extended Pack. The Extended Pack costs $10,000. Full users (concurrent users) will run $3,000 and Limited users (also concurrent) will run $600. According to what was presented there are only two remaining a la carte modules. Those will be Advanced Payroll and HR as well as SmartList Builder. There was also information shared about one additional component needed for customization and integration. Check out this article for a list of modules included with the Starter Pack and Extended Pack

At WPC, Microsoft announced the discontinuation of the Light User and Employee Self Service User for Microsoft Dynamics GP 2010 (and prior) as of July 11, 2012. With this they introduced the following SKUs with revised upgrade rights and pricing:  Light User – Limited Upgrade, Employee Self Service User – Limited Upgrade, Limited Device CAL – Limited Upgrade, and Web User – Limited Upgrade. The reason for this is how the Light User and Employee Self Service User will upgrade. For Microsoft Dynamics GP both the Light User and Employee Self Service User will become Limited users for existing clients.

The change with Light and Employee Self Service users moves away from the old model of named users. Within Microsoft Dynamics GP 2013 the application will now effectively count both the Full and Limited users logged into the system. The users won’t define your mode of access but instead focus on what the user is doing. Full users will have full read and write access through the application or other modes of access. Limited users will have full read access but limited write access. Microsoft also announced that effective October 1, 2012 they will eliminate the additional BRL Business Essentials User tiers (waterfall pricing) and eliminate the additional BRL Advanced Management User tiers above 51-75 users.

The goal of these changes are to drive a more simplified buying experience, lower costs (which it does in most scenarios) and optimize Microsoft Dynamics GP and NAV for the SMB market. Existing customers current on their enhancement plan will move over to this new model without the loss of any functionality and most will gain functionality through the transition. I’m certain in the short-term this move will cause some confusion but I do agree that once the transition is made this new model may finally achieve those stated goals. More to come soon on this topic. Please check with your local Microsoft Dynamics GP partner for more information.