HOW TO LICENSE

Microsoft Dynamics ® ERP Licensing Guide

CUSTOMER EDITION | AUGUST 2010 Using This Guide Use this guide to improve your understanding of how to license Dynamics ERP solutions. It is not intended to guide you in choosing products and services. The examples presented in this guide are illustrative. This guide supersedes and replaces all previous versions of the Business Ready Licensing Guide. Microsoft Corporation reserves the right to review and/or update the existing version without previous notice . For help determining the right technology solution for any given organization, including the license requirements for a specific product or scenario, consult with your Microsoft Dynamics Certified Partner or your Microsoft account team. This guide does not supersede or replace any of the legal documentation covering use rights for Microsoft products. Specific product license terms are detailed in the Software License Terms document, which is available at http://www.microsoft.com/dynamics/en/us/licensing.aspx . Contents Using This Guide ...... 1 Contents ...... 2 Overview of Microsoft Dynamics ERP Licensing ...... 3 Business Ready Licensing...... 4 Overview of Licensing Requirements ...... 4 Licensing Access to the Microsoft Dynamics ERP solution...... 5 Full Access...... 5

Limited Access...... 5 Users and License Types ...... 9 External Users ...... 11 Multiplexing ...... 11 Licensing the Microsoft Dynamics ERP Solution...... 12

Foundation Packs...... 12 Additional Components...... 13 Business Ready Enhancement Plan (BREP)...... 13 Additional Licensing Requirements ...... 14 Five Steps to Counting Licenses for BRL...... 14 Resources...... 16

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 2 Overview of Microsoft Dynamics ERP Licensing Microsoft Dynamics ERP solutions are designed to help address any organization’s specific business requirements and include Microsoft Dynamics ERP solution tailored to vertical industry processes. There are four Core Microsoft Dynamics ERP solutions; Microsoft Dynamics AX, Microsoft Dynamics NAV, Microsoft Dynamics GP and Microsoft Dynamics SL. In addition, Microsoft Dynamics ERP solutions deliver specialized capabilities for the retail industry. Microsoft Dynamics AX 2009 for Retail; Microsoft Dynamics POS 2009, a retail store management system; and Microsoft Dynamics Retail Management System (RMS), a complete point of sale solution for small midsize and large retailers that can be adapted to meet specific retail requirements. The Business Ready Licensing model and the Business Ready Enhancement Plan for Microsoft Dynamics introduce simplifications and improvements in value to the licensing and maintenance programs for its Microsoft Dynamics business management solutions. Business Ready Licensing streamlines pricing for Microsoft Dynamics solutions; Microsoft Dynamics AX, Microsoft Dynamics GP, Microsoft Dynamics NAV and Microsoft Dynamics SL; by moving from a pricing model based on hundreds of modules and granules to a new model based primarily on the number of concurrent users who actually use the software. This new model has two simple offerings: Microsoft Dynamics Business Essentials and Microsoft Dynamics Advanced Management. They are based primarily on a common Microsoft Dynamics ERP solution and represent a price reduction for a typical entry-level configuration, eliminating much of the complexity of licensing enterprise resource planning software. Designed to increase value for customers through the life of their product solution, the new Enhancement Plan represents a global maintenance program for Microsoft Dynamics solutions and introduces new benefits such as transition investment credits, online training courses for customers, and resources to connect customers with the Microsoft Dynamics community.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 3 Business Ready Licensing

Overview of Licensing Requirements When licensing the Microsoft Dynamics ERP products through Business Ready Licensing for on premise deployments, Microsoft Dynamics ERP licenses are required for:

1. User access to the Microsoft Dynamics ERP solution. Any user that directly or indirectly accesses the Microsoft Dynamics ERP solution must be licensed with a Microsoft Dynamics ERP User License.

Note: A single Microsoft Dynamics ERP solution referred to as the “system ” in the Software License Terms is a logical entity that may utilize resources from multiple servers, or processors, or files. Replicas or copies, in compliance with the Software License Terms, of the system database (in full or partial) are considered part of the “system database”. Please find the Software License Terms at http://www.microsoft.com/dynamics/en/us/licensing.aspx

2. The Microsoft Dynamics ERP solution you need and/or is technically required to enable the functional scenarios.

Figure 1: Basic Licensing Requirements

Notes:

 Licenses for additional software required for the solution, such as Windows Server ®, Microsoft SQL Server ®, and Microsoft SharePoint ® Server and their client access license (corresponding to the users) are not included with the Microsoft Dynamics ERP licenses.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 4 Licensing Access to the Microsoft Dynamics ERP solution Any user that directly or indirectly accesses the Microsoft Dynamics ERP solution must be licensed with a Microsoft Dynamics ERP User License. User licensing is based upon the access rights they need. Microsoft offers two editions of Microsoft Dynamics ERP solutions: Business Essentials (BE) and Advanced Management (AM).

Full Access Users connecting to the solution through the Windows-based Microsoft Dynamics rich client user interface (UI) may access all of the Microsoft Dynamics ERP solution included in the solution edition. These users require a Full User license for the selected solution edition (refer to you Microsoft Dynamics Certified Partner to understand the solution capabilities by edition). See Licensing the Microsoft Dynamics ERP solution below for more information about choosing the BE or AM Microsoft Dynamics ERP solution editions.

Limited Access Microsoft offers limited access licenses, allowing access only to specific components of the ERP solution. These limited access licenses are designed to help organizations extend the benefits of the ERP solution to users throughout the organization. Note: Some products may not offer limited user licenses (Light User license and Employee Self Service User license) on the Business Essentials Edition. Customers who are willing to benefit from these limited user licenses scenarios must transition to the Advanced Management Edition.

Light User License The most comprehensive limited access license is called the Light User . Light User licenses allow limited access to the Microsoft Dynamics ERP solution by means other than the Microsoft Dynamics rich client UI (indirect access).

Employee Self Service (ESS) User License The Employees Self Service User license provides a lower-cost alternative for licensing employees for access to the Microsoft Dynamics ERP system through means other than the rich client UI for only the following purposes:

 Employee Administration: Management of the user’s own data and profile residing in the system database.  Employee Time and Attendance: Input of time sheets and clock-in/clock-out data corresponding to the user.  Employee Travel and Expenses: Input and update user’s data related to expenses and travel requisitions.  Employee Requisitions: Submission of user’s requisitions limited to their own purposes, such as personal purchases or services, or leave of absence. Note: The ESS User license is only applicable for employee self-service activities on his/her own behalf that impact only the individual’s records. It is not meant to license any employee activity related to projects that are part of the business value chain (e.g. tracking time and attendance for a

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 5 billable project). This type of activity is licensed with a Light User license or a Full User license (depending on the mode of access and usage scenarios).

Figure 2: Comparing Full Access Users to Limited Access Users

Figure 3: Users Requiring Both a Full User and a Light User License Users who access the Microsoft Dynamics solution through the Microsoft Dynamics rich client UI and through other means (while not logged into the rich client UI) require both a Full User license and a Light User license.

Limited Device license This limited client access license allows a named device, serving a particular and single purpose to perform a) data capturing tasks, input only devices, e.g. scanner, RFI or b) to display information, output only devices, e.g. displays, printers, to be connected through any other mean than the rich client (indirect access) to the Microsoft Dynamics ERP solution. Note: This license is not meant to license any Input-Output device. Only unidirectional (Input or Output) devices may be licensed with the Limited Device CAL.

Microsoft Dynamics AX for Retail Point of Sale (POS) Device Client Access Licenses (CALs) To license retail Point of Sale (POS) devices (devices used by any user to access the Microsoft Dynamics AX for Retail solution for the purpose of completing customer sales or services transactions within the retail store), three types of POS Device CALs are available:

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 6  Microsoft Dynamics AX POS Device CAL: This license provides access to the Microsoft Dynamics AX for Retail solution by a POS device that is running the Microsoft Dynamics AX for Retail rich client UI for the purpose of completing customer transactions.  Microsoft Dynamics AX Store Management POS Device CAL: This license provides additional access rights for a POS device that is used to access the Microsoft Dynamics AX for Retail solution using the rich client UI for in store retail activities. Typically this additional Microsoft Dynamics ERP solution is used by store managers.  Microsoft Dynamics AX External POS Device CAL: This license provides indirect access (through means other than the rich client UI) to the Microsoft Dynamics AX for Retail solution by a POS device using a third-party POS solution that interoperates with or connects to the Microsoft Dynamics AX for Retail solution (e.g. via web services).

Figure 4: Licensing POS Devices for Transactions and Store Management In this scenario two POS devices are running the Microsoft Dynamics AX for Retail rich client UI. Both devices are used by cashiers for completing customer transactions. This access is licensed through the AX POS Device CAL. One POS Device (POS Device B) is also used by the store manager) to access the Microsoft Dynamics AX for Retail solution using the rich client UI for in store retail activities. This access is licensed through the AX Store Management POS Device CAL.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 7 Figure 5: Licensing a POS Devices for Transactions and Store Management Activities In this scenario one POS device (POS Device A) is running the Microsoft Dynamics AX for Retail rich client UI and is used by cashiers for completing customer transactions. This access is licensed through the AX POS Device CAL. The store manager uses another POS device (POS Device B) to access the Microsoft Dynamics AX for Retail solution using the rich client UI for in store retail activities. This access is licensed through the AX for Retail Store Management POS Device CAL.

Figure 6: Licensing a POS Device for Running a Third -Party POS Solution In this scenario a POS device is running a third party (non-Microsoft Dynamics) POS solution that uses web services to access the Microsoft Dynamics AX for Retail solution for completing customer transactions. This access is licensed through the AX External POS Device CAL.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 8 Specific Microsoft Dynamics ERP solution User Licenses Some components offered with a Microsoft Dynamics ERP product will allow access to only a specific functional area, and require a user license (or other metric used) for that specific Dynamics ERP solution. Refer to the Microsoft Dynamics Certified Partner for the complete set of required licenses.

Users and License Types There are primary four license types under Business Ready Licensing: Concurrent User licenses, Named User licenses, Named Device licenses and the External Connector Users license. For users that are employees or others performing business processes on behalf of the organization or who are integrated into the organization’s operations (such as onsite contractors, vendors, or agents), the organization must license Concurrent Users and/or Named Users, depending upon which is offered for the specific user licenses required. (For instance, Light User licenses are based on Named Users, whereas Full Access licenses are available based on Concurrent Users.) Please contact the Microsoft Dynamics Certified Partner to determine the user type(s) that apply to specific scenarios or speak to your Microsoft Account Representative. For access to the Microsoft Dynamics ERP solution by external users (such as the organization’s customers or vendors/suppliers not performing business process on behalf of the organization), the organization has the option to license users via an External Connector license. Each external connector license assigned to a Microsoft Dynamics ERP solution permits any number of third party users to access indirectly to the Microsoft Dynamics ERP solution. You do not need Named User licenses for those users. The External Connector may not be used for business process outsourcing purposes.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 9 Named Devices External Connector Concurrent Users Named Users Users

Concurrent User licenses Named User licenses are Named Device External Connector are based on the maximum specific to an individual licenses (e.g. POS licenses allow third-party number of users that may user and cannot be shared. Device, Limited users to access the access the Microsoft Often, this model is used to Device) are specific Microsoft Dynamics ERP Dynamics ERP solution provide certain individuals to a named device solution. Third party users simultaneously. Concurrent access to specific Microsoft and cannot be are any users that are not User licenses can be shared. Dynamics ERP solution. shared. Often, this employees and do not model is used to perform business Unlike Named User Note that if a user leaves provide many processes on behalf of the licenses, which are the organization, the license individuals access to organization (such as permanently assigned to an may be reassigned to specific Microsoft supply chain vendors). individual, Concurrent User another user. Dynamics ERP licenses are assigned Only one External solution thru a temporarily to a user for Connector license is named device. the duration of their active required for each session. Once that Note that if a named Microsoft Dynamics ERP individual end the active device is replaced, solution. session, the license may be the license may be used by another individual reassigned to and the previous users is another named not anymore licensed to device. use access the solution.

Figure 7: Comparing User Types

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 10 External Users

Figure 8: Identifiying Internal Users vs External Users

Multiplexing Multiplexing is the use of hardware, software (including manual procedures) to reduce the number of devices or individuals that access or use the Microsoft Dynamics ERP solution by pooling connections. Multiplexing does not reduce the number of licenses required to access the Microsoft Dynamics ERP solution. Any user that accesses the Microsoft Dynamics ERP—whether directly or indirectly—must be properly licensed. Note : Licensed users may manually rekey information (when coming from non-licensed users) into the ERP solution. This scenario is not considered as multiplexing. Figure 9: Multiplexing Does Not Reduce Number of Licenses Required

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 11 Licensing the Microsoft Dynamics ERP Solution

Foundation Packs For each Microsoft Dynamics ERP solution deployed, an organization needs one Business Ready Licensing Foundation Pack license. A Foundation Pack contains several functional components. The Foundation Pack is offered in two editions—Business Essentials (BE) and Advanced Management (AM). In order to understand available editions and included Microsoft Dynamics ERP solution, refer to http://www.microsoft.com/dynamics/en/us/editions.aspx and please contact your Microsoft Dynamics Certified Partner. Notes:  A single Microsoft Dynamics ERP solution (also referred to as the “system database”) may utilize resources from multiple servers or processors..  Licenses for additional software required for the solution, such as Windows Server, SQL Server, and SharePoint Server are not included with the Foundation Pack license and they must be licensed according to their license terms.

Figure 11 : Licensing the Mi crosoft Dynamics ERP solution

The Business Essentials (BE) Foundation Pack provides basic Microsoft Dynamics ERP solution for organizations with less complex business requirements. The Advanced Management (AM) Foundation Pack includes all the Microsoft Dynamics ERP solution in Business Essentials, along with more advanced Microsoft Dynamics ERP solution typically needed by larger or more complex organizations.

How to Get the Foundation Pack License The Foundation Pack License is included with the first Full User license acquired. For instance, if the organization wants to license the Microsoft Dynamics ERP solution of the Advanced Managment (AM) edition, they order AM Full User licenses.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 12 Additional Components Organizations may buy licenses for additional components (granules/modules) on an individual basis. In certain cases, in addition to component licenses, additional licenses per metric may be required. For currently-available Microsoft Dynamics ERP solution/components contact your Microsoft Dynamics Certified Partner.

Business Ready Enhancement Plan (BREP) The Microsoft Dynamics Business Ready Enhancement Plan (BREP) offers multiple features that help to maximize the value of the Microsoft Dynamics solution. These benefits include the ability to upgrade to newer versions of the software when they become available, as well as to receive fixes, updates, service packs, and tax and regulatory releases. For more information on the Business Ready Enhancement Plan, please contact your Microsoft Dynamics Certified Partner. License Transitions

Microsoft Dynamics currently has three types of license transitions for customers wishing to change license model, product line, or product edition:

License Model Transition (LMT) Product Line Transition Edition Transition

Move from Module Based Move from one Microsoft Move from one edition to Licensing (MBL) to Business Dynamics product to another within the same Ready Licensing (BRL). An LMT another (e.g. from product line and licensing allows customers to convert their Microsoft Dynamics SL to model (e.g. Microsoft existing MBL-based licenses into Microsoft Dynamics NAV) Dynamics AX Business BRL-based licenses within the Essentials to Microsoft same product line. Dynamics AX Advanced Management)

For details, please contact your Microsoft Dynamics Certified Partner.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 13 Additional Licensing Requirements There are also very few components that need to be licensed based on additional metrics (for example, the number of employee records or languages being used). For additional details, please contact your Microsoft Dynamics Certified Partner.

Five Steps to Counting Licenses for BRL

Note: The estimate count of licenses based on these five steps methodology may vary depending on specific conditions and scenarios. This is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS DOCUMENT. Please contact your Microsoft Dynamics Certified Partner for more information about licensing and pricing.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 14 Frequently Asked Questions (BRL)

1. Why is not sufficient to license a SQL CAL to access the Microsoft Dynamics ERP solution? The SQL CAL licenses an individual user or device to interact with SQL Server, but does not include the rights to access the Microsoft Dynamics ERP solution.

2. Why is a good idea to use the Light User option for extending the ERP solution to more people in the organization? Extending the ERP solution to users who do not require Full User access can bring tremendous value to the customers, such as the ability to automatize activities within a secure and managed environment that aggregated across the organization can create significant productivity and business intelligence improvements.

3. Does the Light User license include the ESS User access rights?

Yes. Once a user is licensed with the Light User license, then he does not require an ESS User license.

4. Does the ESS User license allow users to access the solution for projects and/or consulting services? No. The ESS User license allows users to access the ERP solution to payroll specific self-service activities. This helps customers to increase productivity and automate payroll activities that usually improve productivity and reduce costs with non-billable activities.

5. Does the External Connector license unlimited Light Users access? Yes. External users are required to be licensed as Light Users. Since many customers may face scenarios with millions of external users and/or unknown numbers of external users, then the External Connector license becomes a great benefit to cap the licensing cost in oppose to licensing user by user.

Microsoft Dynamics ERP Licensing Guide | August 2010 Version | Customer Edition | Page 15 Resources

Microsoft Dynamics Web site Learn about what Microsoft Dynamics solutions can do for your organization and how to get started. http://www.microsoft.com/dynamics/en/us/default.aspx

CustomerSource Microsoft Dynamics CustomerSource is a password-protected site for customers who use Microsoft Dynamics products. Included as a benefit of your service plan, CustomerSource allows you to search a powerful Knowledge Base for Microsoft Dynamics, view online training for Microsoft Dynamics, download updates, and find other timely information and resources virtually 24 hours a day. (Sign-in required.) http://www.microsoft.com/dynamics/en/us/customersource.aspx

This document is for informational purposes only.

MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED, OR STATUTORY, AS TO THE INFORMATION IN THIS DOCUMENT.

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