Episode Four w/ Rich Gibbons [Transcript]

Rich Gibbons Discusses Microsoft Licensing, Avoiding Unnecessary Costs And Navigating The Options.

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David (00:03.208)

Welcome to another episode of Mastering Mondays. We have an extremely handy guest with us today, Rich Gibbons. Now, Rich is based here in the UK and is one of the licensing experts at Sinega. Rich specializes in Microsoft licensing, IT asset management, FinOps and GreenOps. And if you're not sure what FinOps and GreenOps are, then you can find out by heading over to Sinega TV on YouTube where all will be revealed.

I hope we can make the topic of licensing both intriguing and informative to our listeners. So no pressure there. Rich, great to have you with

Rich Gibbons (00:37.304)

Thank you very much for inviting me. It's a pleasure to be here and we will absolutely make licensing interesting and intriguing. I can guarantee

Matt (00:47.718)

Okay, so before we find out how to save life -changing amounts of money for organizations and their licensing, can you share with us your journey? So how did you evolve into the tech expert that you are now and you're specializing in licensing as we mentioned? What were the key moments that shaped your path?

Rich Gibbons (02:57.662)

Great question. So I think like a lot of people it was pretty accidental. I started as a reseller a little bit over 20 years ago and you know we sold all kinds of things but for whatever reason Microsoft licensing caught my eye and you know I mean 20 years ago it was a bit of a different world than it is now and I was a reseller for a bit over a decade.

I've worked with lots of customers and partners in Microsoft licensing, moved into doing Microsoft training and then from there, moved into the IT asset management world, which links up with licensing perfectly. I've been a reseller, an analyst, a trainer, a consultant, all sorts of things, but the common thread has always been Microsoft licensing and I think, you know, it's certainly not got any easier over the last 20 years. So I think it will keep me busy for the foreseeable future as well.

David (04:05.265)

Can I ask you, why is licensing so complicated? mean, just looking at the options for say, education providers alone, we've got A1, A3, A5, and of course, then you can add on various products for businesses, you've got basic standard premium, then into enterprise, and you've got all your frontline options, you know, the list goes on and on. Is it as complicated as it appears, or are there some shortcuts to making it simpler?

Rich Gibbons (04:32.961)

I think yes, it is as complicated as it appears and yes, there are shortcuts as well it it it's a really Not you know, not not it's not done on purpose. I don't think you know, I think it all comes from You you they have a product and they say right this is how we do it. But then there are all these different Scenarios, so, know, well if it works like this for a customer who's got 50 users

It probably can't be the same for someone who's got 50 ,000 users. So then you end up with slight differences and then it's like, actually, you know, if you've got a user, but they only do X and Y and they don't do Z. So then over time, and it happens with every manufacturer, not just Microsoft, you know, you end up with these slight variations and, you know, different levels and things. And then because Microsoft's portfolio is so vast these days.

When you look at the entire thing, it looks insane because there are hundreds, not thousands of products all with their own variants and levels and things. But in general, when you focus in on the bit that's relevant to you. So if you're a corporate customer, don't look at all the education options, just look at the corporate bit and then you can kind of start to filter it down.

But then on the other hand, it is still very complicated in most cases, even once you get down to the kind of the nitty gritty, there are still so many variations. So I think it's, yeah, it's a bit of both. It's complicated, perhaps not as complicated as it initially seems.

Matt (06:41.151)

Can you tell us about the types of businesses you work with? Are you seeing any change in the types or the sizes of businesses? Who are you feeling the need to look at their licensing or relook at their licensing due to the spiralling costs that some of these licences are? Who are you working with?

Rich Gibbons (07:27.03)

Again, great question. So Microsoft licensing tends to be a bigger concern the bigger your organization. Because you're using more products, you're using more of them. So then there's more chance for getting it wrong. So, know, if you're, there are two sides to licensing as well. There's the being non -compliant side. So, you know, there's the worry I'll be using this product incorrectly. Have we bought the wrong licenses? But then there's the other side, which is, you know, are you over licensed? Have you bought too many or have you bought E5 when you only really need E3 as a common example. So there are two sides to it and probably the cost implications since cloud and know, SaaS and cloud since they became as big as they are, the concerns about spending more than you need to are bigger than ever. And I think that concern applies pretty equally to a small customer as it does to a big customer, because then it's all about percentage of budget. So, know, if you're maybe one company is wasting five thousand pounds a year and another company is wasting five million pounds a year. But if it's still 10 % of the budget for each one of them, you know, it's as big a problem. So really, you know, mean, at San Diego, you know, we work with larger enterprises and public sector organizations, but the kind of need to understand licensing, I think, impacts more organizations than ever before. It used to be relatively straightforward. If you were an

You know, there weren't as many products, weren't as many options, but now over the years, there's been a real kind of blurring of the lines between SMB and enterprise in terms of what products Microsoft make available to them. So, yes, it's kind of important for everyone, but I think cloud means that cost management is very important.

David (09:52.884)

Can I ask a little bit more about that? you know, because licensing is increasingly based on capacity now, know, and commissioning cloud resources. Now, this is outside the comfort zone of many SMBs, you know, who used to fix licensing costs. How do larger organizations estimate the impact of implementations? Because obviously, smaller organizations are going to have to pay attention to this, particularly, for example, you know, when we take into account Copilot Studio where you've got 200 ,000 notes for your base cost or whatever. how do larger organizations estimate their costs? Because a smaller organization won't be used to doing this at all.

Rich Gibbons (10:39.502)

They do it with great difficulty. It's a problem for most organizations and something that I talk about quite a lot is the changing metrics from Microsoft. And again, other software publishers as well, but Microsoft are a really good example. Back in the day, everything was per device and per processor. Then it became per call, then per user.

But now when you look at the Microsoft portfolio, there are so many metrics that can only exist in the cloud. So there are products that are done by the number of requests per second that the database uses. As you've said, the number of messages that sent between a chat bot and a user. Some things are done based per minute, per second, per call, per this, that and the other. So for any organization, it's really difficult to track, partly because first of all, you have to even know what metric applies to what product, and that isn't always the easiest to find out. And then even once you do know, how do you then ascertain that number? So right, it's done on

So know, Cosmos DB is requests per second, but how do you track that? How do you manage that? And probably more importantly, how do you forecast that? So as you say about, you know, fixed costs, it's always been the case pretty much that you could look at your estate and you say, right, we've got this many people that doing these things with these products. That's going to cost us about X over the next, you know, 12 months or 36 months.

Cloud has thrown out the window so much now, partly because you don't know how to forecast these metrics and partly because cloud usage is so variable. And this is where you get into the world of the FinOps side of things, cloud cost management and it's looking at, right, because you get into the scenario.

Rich Gibbons (13:07.054)

You might work it out and say, right, this is going to cost us 300 ,000 pounds this year for this project. But then if the project is really successful and you you're bringing on more and more customers because of this cloud service, you'll start to use more and more clouds. So then that 300 ,000 might become a million. And overall for the business, it's a good thing because you've brought more customers in, so you've earned more money, but your budgeting is, you

all over the place. So large organizations struggle, know, they have FinOps teams, have IT asset management teams, have procurement teams, all working together. And yeah, it's a huge, huge thing. And obviously, you know, the bigger organizations, the numbers, you know, some of them are spending hundreds of millions or billions of pounds a year in the cloud.

So the numbers are huge, but even for SMB, it's so easy for the cloud. You get this kind of concept of bill shock. You're thinking it's going to be about a thousand pounds. Actually, it's 15 ,000. What are you going to do about it? You've already used it. You have to pay it. And you have to try and stop it happening again. So it's a really difficult scenario and some of it is down to licensing. Some of it is down to, you the, the difference of cloud. but it's, yeah, so a heady combination.

David (14:47.744)

One thing that strikes me is that if you created the worst possible chatbot, then you could get really stung, couldn't you? Because there's so much toing and froing. So the efficiency of actually creating this kind of technology, you've got to craft it to keep the costs down.

Rich Gibbons (15:08.206)

100 % and it's something and it's saying in the world of FinOps and where it crosses over with asset management and licensing the other this concept of Kind of you've got licensing conscious architecture and and working with engineers So that so that they understand right, you you doing this Will cost us but if you do it in a slightly different way, it will cost us half of that Because you know, there are lots of Microsoft products now, you know, there are charges for API usage data storage and different types of data is it file storage or is it data verse and and when you're an engineer and you know, you know, you're crafting a tool or a product, you just kind of build with what you've got available. So then there's a concept, it comes from software engineering. It's a concept of what they call shifting left. through the sort of design process, typically licensing is the last thing. You everyone's been working on it for months. Then just as you deploy it or just after you deployed it, someone goes,

I wonder how much this all costs and then either you'd have to delay everything by months while you work it out or the project goes ahead and someone just has to suck up the fact that it costs, you know, eight times more than they wanted it to. So this concept of shifting left is having licensing and asset management and fin ops and things involved sooner in that process. So as people are building or designing a tool or architecting a cloud solution, whatever it might be, that they're thinking to themselves, right, if we do it this way, what will it cost? If we do it that way, you know, will that reduce the number of messages that we use or the amount of API calls that we make? So it's quite cutting edge for organizations to think about this because, you know,

Rich Gibbons (17:31.32)

For years and years, licensing has always been an afterthought almost for a lot of organizations. And when you were paying an agreement that's three years or five years, it wasn't always that noticeable. But when your bills are coming in every day or every month in the cloud, you start to see those problems sooner. So yeah, they're kind engineering awareness is a big thing, but there are so many layers between, you know, people like me or Microsoft or whoever, we've got the licensing knowledge, so many layers between them and the engineers are building the products. One of the challenges for customer organizations is, you know, getting that information to those people at the right time. And, and yeah, that is

If we had an answer for that one, this would be a fantastic podcast, but I've not quite got there yet, I'm afraid.

Matt (18:35.739)

I just want to go back to your point about companies over licensing for a second. So I've seen this with businesses and education providers that I've worked with. Now I'm wondering, is it due to poor understanding of the different types of licenses or companies just thinking, well, give them everything now so we don't have to look at this again and let's not worry about the cost? Which is it.

Rich Gibbons (18:59.198)

It's a bit of both to be honest that there are a few reasons, know, some of it is, excuse me. some of it is that you kind of look at it you think, right, it's got all these brilliant things in it. Obviously we want to use them all. They're all wonderful. So we'll buy them. But then as we all know, you know, there's a difference between having a product or a feature and then getting everyone in the organization to understand it and use it. So very often people buy the bundle with the intention of utilizing everything, but generally, you know, without a kind of change management program and a comprehensive training program, people just use what they're familiar with. So they use Word and Excel and PowerPoint Outlook. They might click on a couple of other things, but in general, you you have to put...as much effort and sometimes as much money into the adoption piece as you do the purchasing of these products. So sometimes it's that, sometimes it will be certainly for the larger organizations, you get discounts. So, know, Microsoft will say, right, if you buy the higher version, we'll give you, you know, a nice discount off. And you think, that works.

But then later on, you you haven't deployed it or potentially it's the case that, you get the discount for year one or maybe even years one to three. Then when you renew, the discount has gone and now you're paying full price. So it's a combination of a few different things. And sometimes it can be. And then this is where you get into

They're having lots of different options as well because what they used to be, you add E3 and E5. So for some organizations, it was a case of like, right, well, I need one or two of these features in E5. So I'm going to have to buy the whole thing. So then they were paid more than they really wanted to buy in products that they didn't really need. So over time, Microsoft have made a variety of E3 add

Rich Gibbons (21:26.499)

which are little bits of E5, know, the security and governance and things. So then when you look at the product list, there's all these bits and pieces, but that's to try and fit in those organizations that need a middle ground. So that, the add -on piece does mean that then customers can buy a kind of base bundle and then add on the bits that they need.

But then that becomes complicated to manage and you have to be watching for actually we've added four add -ons. That's more expensive than if we just bought the whole bundle. yeah, they make it easier on one side and more difficult on the other. But yeah, people ending up with bundles where they're not using the majority of them. Very, very common.

Matt (22:24.882)

Great, thank you. Almost every business will either be using Microsoft 365 or maybe even Google Workspace for their generic business needs. Is there much difference between them in terms of licensing costs and functionality from your perspective?

Rich Gibbons (22:40.414)

so yeah, I mean, I'm not, I'm not massively familiar with, with the Google license inside of things. I think it's from what I'm, what I know, I think it's more straightforward. You know, there aren't as many options and add -ons and things, but I think that's also because, you know, it isn't as, as comprehensive. and you know, my, my background is a hundred percent Microsoft.

I struggle every time someone makes me use Google Sheets or Google Docs or something. So I'm aware that I'm coming at this from a slightly biased angle, but I think, you know, if you look at what can you do in Microsoft Word and what can you do in Google Docs, it's probably quite similar for most people. But then when you look at the wider, you know, Microsoft 365,

All the extra things that are included in there. And often, you know, it's things that people aren't using, but really should be, you know, things like Microsoft bookings, Microsoft planner, some of it, you know, the additional things that you can do in teams that people don't realize. I think the, you know, to use, you know, you know, the older kind of iceberg analogy that always appears in tech conversations, know, the bit under the water of Microsoft 365, I think is much bigger than with Google. yeah, me personally, I think it's a bit of an apples and oranges comparison. And I think the strength of Microsoft is the breadth of the portfolio, but also in some cases, I think that the weakness is that breadth of portfolio. Some organizations they want one thing that does one thing and that's all and Microsoft can be a little bit overwhelming but yeah I would always choose Microsoft 365 over Google but I'm sure you'll do another podcast with someone else who will say the exact opposite so yeah we can do a head -to -head one day maybe.

Matt (25:00.902)

Yeah, that sounds like a good idea. I'm so pleased that you mentioned Bookings and Planner, because along with lists and forms, they are my two absolute favorites. And I definitely believe that businesses and education providers should be using them much, much more than they currently are. So it's great to hear that. Before I ask you the next question for our listeners, it's worth noting that Microsoft offers an F1 frontline license designed for frontline workers. This includes access to tools like Teams, Bookings, Planner.

SharePoint Online and Microsoft standard security features, or for just around two pound per month, which is super cheap. So my question to you, Rich, is do you think this is an underutilized option? Could it be that some organizations are over -licensing and not using this when they should be?

Rich Gibbons (25:51.086)

Um, yeah, so I think the frontline skew I'm quite a fan of it. So, you know, when I was a reseller, you know, when things were kind of on premises early days of 365 back when it was BPOS, um, you know, there was a real gap for organizations, you know, with drivers, consultants, engineers, where you, know, really you wanted them to be part of the organization, but they didn't need full licensing. So you either bought them more than they needed or you had to kind of leave them out. So I think the frontline worker SKU fits that gap really nicely. And more and more businesses I talked to are using the frontline worker SKUs. I think that's possibly an area where Microsoft have complicated matters. know, there used to be just one F SKU. Well, okay, know, case users as they were. But now you've got, you know, there's Office 365, F3, and then there's Microsoft 365, F1 and F3. And then there are F5 add -ons that you can add on to those. And I think this is where organizations start to look at it and go, well, I started off looking at one thing for two, two pounds. Now, these extra bits, it can start to mount up. So there is, there is quite a lot of change in that space. But I think for businesses, you you can cover quite a good set of your users. There are limitations, you Microsoft have made sure that you can't just cover your entire organization with F1s, you know, there are limits around the size of device and this kind of

But if you understand those rules and if you understand your business, so with Microsoft, we often talk about having kind of profiles. So you'll have, know, what Microsoft will call your knowledge worker. If you can split your organization and say, right, we've got, you know, 107 frontline workers, they need this license.

David (28:17.658)

In our, side hustle sort of cafe thing, which we've got about 50 staff, lots of them kind of very fractional. We use the F1 license very widely. We use it for absolutely everything. You know, it's our intranet, obviously via SharePoint. Every member of staff has Teams on their phone. They use shifts. You know, we do a shift planning via Teams. They clock in and out and we monitor their hours. They do all their holiday requests and holiday approvals via it. And it's also their social space as well. know, it, mean, it's, from my perspective, for that kind of a business, it's absolutely priceless. It's a fantastic product. And we really don't see any shortcomings to that cheapest license in that business context.

Rich Gibbons (29:09.996)

Yeah, I mean that's great, great. And I think, you know, Microsoft do have a reputation for complexity and things. And some of it is warranted. And, you know, there are other things that they're doing in the cloud, et cetera. they do, you know, the products are good and they do generally, you for most people they are what they need. So I for organizations, if you're gonna use Microsoft products, really taking the time to look at it and work out which ones are right for you and then exploring what they can do fully. all the things that you've listed there, maybe on day one, people won't notice that they're there. And I think having some sort of plan for saying, right, we've bought this thing, maybe we've bought it for this feature and that feature, but let's make sure we explore the rest of it as well. Because that makes your ROI improve as well. If you've spent X amount for two products, but actually you turn out you're using seven products. So yeah, I think the F SKUs can be quite transformational, I think, for smaller businesses.

Matt (30:41.862)

We've talked about over licensing. You we've looked at what's right for you, importance of using everything. And if you're not then looking at what that's costing you. So with all that, tell me if you were to give free tips to SMEs and education providers for optimizing their licensing, what would it be?

Rich Gibbons (31:00.622)

That is a big question. I think the first thing is, you know, understand your organisation and your environment and don't just base, know, if you've got a renewal coming up, don't just base it on, well, last time we bought X, Y and Z in these quantities because you get effectively it's like technical but within software, know, some, bought something 10 years ago, everyone just keeps renewing it. And then you look at it and think, well, actually we're not using this anymore. Or this was the best option three years ago, but now Microsoft have made a new bundle or they've taken this and they've done that. So I think really understanding what, what you're using now, but also what you're going to be using next year, in three years, in five years, because there are ways, and this depends on the size of your organization, but you can build contracts to grow over time, et cetera. So I think that initial understanding, and I think being aware of things like Microsoft Core Pilot were, everyone is going to want core pilot because it's cool, someone else has spoken about it, but it will add a lot to your budget and it's understanding do you need it? Do you have a process for analyzing whether these products are being used? know, kind of within the asset management space, a big part of it is right, Matt, you you've had this license for

For 90 days, you only opened it once. Pretty sure you don't need it. It always used to be project and Visio. Everyone insisted they needed project and Visio. No one actually knew how to use it, but they didn't want to lose access to it just in case. And now, you know, Power Platform, Co -Pilot, those are the new project and Visio in many ways where everyone likes to think,

Rich Gibbons (33:28.812)

I'm going to create this app. I'll do it next week. I need the license. But very few people actually do. being aware of that side of things. And if you're using clouds, I mean, that's a whole conversation on its own. But I think there are two things with cloud optimization. There's what you're using in the cloud. So we talked about kind of the engineering side being aware there are various tactics to manage cloud spend, but also with Microsoft in particular, there's a range of kind of bring your own license options, the Azure hybrid use benefit and things like that, licenses that you're already paying for on premises.

You can use them to reduce your cloud spend in Azure. And obviously there are various rules around which products and what you can do with them. But for a lot of organizations, if you're in a hybrid environment, which everyone is, everyone's on -prem and in the cloud, looking at how you can use what you've already paid for to reduce your cloud spend, I think is a really big option that a lot of people aren't taken advantage of at the

Matt (34:56.85)

I think businesses and education providers are doing yearly reviews on contracts that are up for a new outside of Microsoft. So staff contracts, vendor contracts, various energy and other building maintenance type contracts. But actually I've never heard of anyone meeting to discuss a Microsoft renewal and looking at what is actually needed. So that is a really good tip because I don't think that's happening as much as it should.

Rich Gibbons (35:23.106)

Yeah, and that's certainly something, you what you mentioned earlier about smaller organisations learning from, you know, enterprise businesses. That is a really big thing that, you know, really with Microsoft, when you sign a three year agreement, they are already from day one, they've got a process working towards your next renewal and the more successful larger enterprises. Do something similar where, know, they're like, right, we've signed a three year agreement, but we need to be thinking about this at least annually, you know, tracking monitoring. and it's easier said than done because you need people and time and resources to be able to do that. So not every business will, be able to do it straight away. But I think, you know, looking at your contract and I suppose you need to make a decision, you

If we put the time and effort into this, do we think we will save more than we're spending? And I think in most cases you probably will. But yeah, regular reviews, your dashboard, what are we using? When was it last accessed? When's our renewal date? All that kind of thing. The more information you can have, the better position you will be in to renew based on what you not what Microsoft want and that's the ultimate aim really that your renewal reflects your needs.

David (37:01.391)

Can I ask you, Rich, Microsoft Power Platform is extremely competent and there's the ability to create all sorts of apps on top of it, particularly Power Apps. Are there many third party apps that are licensable above the main platform, possibly created by third party developers?

Rich Gibbons (38:23.694)

That's an interesting question. I think everything that I've seen with Power Platform, Microsoft see it very much as a relatively self -contained ecosystem. I have seen some third -party products that will extend. You've built something in Power Apps, you can extend it in some ways. But I think for Microsoft,

And this is, you know, an overarching aim for them. Their preference is that you only need to use Microsoft products. So, you you open your Windows laptop, you open Teams, you open Outlook, and then, you know, you don't need to go anywhere else because, you know, the power platform stuff that you've built is accessible in Teams. And that is their ideal.

But then, you know, having said that, there is a growing space for third party ISVs in the Azure marketplace. Quite a lot happening in that area. I think for Power Platform specifically, you know, there are lots of partners that work and can help customers develop internal apps. Because just as you say, you know, and I, very much one of these people. I get Power Apps and I think, right, I'm going to build this amazing thing. But even though they call it low code, no code, it's still a bit more complicated than that name really suggests. So I've never quite managed to do what I want to do with it. So there are partners that can help with that side of things. But of course, Microsoft are constantly evolving the Power Platform family.

So I think they will they'll probably expand if there are bits that third parties are doing Microsoft will probably try and fill laws in themselves

David (40:29.13)

Much as they do, I guess, with Dynamics and have done for a while. But can I ask you about Dynamics? It seems expensive. These are big licensing costs, aren't they? And when you actually look at the Power Platform, you have access to many of the same tables, although some are restricted. say, for example, you're an SMB and you're wanting to create some CRM system that's particularly relevant to your area of business. The question I've got is, would you develop that just for power apps or is there value in using dynamics?

Rich Gibbons (41:12.302)

That is a really good question. And I think, you know, it does depend on your use case. think, know, dynamics is expensive. I think all enterprise level CRM and ERP systems are, you know, if you look at Salesforce, that's expensive. Even things like HubSpot, which, you know, start off free or, you know, quite low cost as you go up through the levels that can become quite expensive as well. So I think, you know, there is definitely a set of scenarios where if you only need a specific thing, then yeah, as a business, rather than just assuming I need to buy this off the shelf product, you know, do look at what you can do with the licenses that you have, especially because, you know, with Microsoft 365, and you do get what they used to call seeded rights to some of the Power Apps and Power Automate. So even if you don't have a full license, you can do certain things within your Microsoft 365 licensing. So I think it's always worth examining that. The counterpoint is with Power Platform and

There is a growing area of potential licensing confusion and complication. So there's a concept called multiplexing, which really used to be a big thing with SQL Server. So multiplexing is the idea that you can't use a technology to reduce the number of licenses that you need.

So the SQL example was always, you know, if you have 500 people, you need 500 SQL client access licenses. You can't have those 500 people all accessing one computer that then accesses SQL and say, oh, I only need one license. That's kind of multiplexing in a nutshell. And it's come back with Power Platform. So there are more and more scenarios where...

Rich Gibbons (43:39.126)

You can, you know, you've got some data. You've some people have got dynamics licenses and people have got power apps licenses. There's data in these different tables. Some of it's in data verse, et cetera. And there are more and more scenarios where it becomes unclear. Actually, you know, that data was created by someone with a dynamics license. Can someone with just a power apps license. you know, manipulate that data or can they do this? And I think this is going to be an area where some organizations get get caught out. Microsoft will eventually decide what the rules are. And, there will be, you know, we're still a few years away, but I think, you know, there will be a program of Microsoft doing audits and compliance checks and things. So for some businesses, there is a risk that if you if you build something yourself using you know, included rights and power apps and moving data and things, you might completely inadvertently, you know, fall foul of a rule, which then further down the line, you know, costs money and you have to retrofit everything and maybe buy the licenses. And it's a very woolly situation because there isn't, and this, think, is the thing that always surprises people with licensing. It isn't always black and white. There isn't always a yes or no. And there's an element of what's your appetite for risk. You you, you might be able to save some money and it might be fine, but if it isn't fine, it might be expensive. so, so there's always that consideration as well. And it's always been there with all software licensing, and again, it brings us back to the proliferation of licenses that vendors, they make a product, they give it some licensing rules and they expect customers to do A, B and C with it. But then some customers work out a way of doing F, G and seven as well. And then the vendor has to go, well, if you're going to do that, then we need to license it in this way. And power platform is still growing and evolving..

Matt (46:18.546)

Thanks. What trends are you seeing in the industry? So is there a general move towards a particular licensing model?

Rich Gibbons (46:29.518)

So with Microsoft, over the last 10 years, the move has been towards per user. Everything has been going per user and everything was going into bundles, E1, E3, E5. But then the last couple of years, they're moving away from that in many respects now. there was a time where Microsoft 365 E5 included almost everything that was available. But now there are probably nearly as many add -ons or products which exist outside of any bundle. So Microsoft are looking at, you buy a bundle, but you also need to buy add -ons, point products. So that's been a change moving towards a more fragmented, disparate licensing model, think. And then also many, many more things, which is, as we said earlier, you know, hard to track and quantify. you know, storage API credits, API usage, things like AI builder credits, you know, the, the, the core pilot studio messages things where even the most mature organization that's got world -class licensing program, asset management, et cetera, they will really struggle, even them, to be able to say, we've got all the dataverse storage. You look at it, we're paying for all this additional dataverse storage, it turns out.

No one will have any real central control over what is that storage? Do we need it? Could we get rid of it and reduce our bill? Same with API calls. You know, if it turns out that you're buying, I don't know, you know, let's say 5 million API calls additionally every year. Who's to decide whether that is, is too many. that enough? So all these new metrics and models that are much more difficult to govern and organizations will need to learn them and build new processes and that takes time. I think while customers are trying to catch up, that's where there will be overspend and under licensing and non -compliance. So I think you know, that's been a big thing. And then across the industry, you know, just the move to clouds, you know, everything, whether it needs to or not, you know, being in the cloud or connected to the cloud and Microsoft, you've got, know, Azure Arc, which they, they are kind of putting into pretty much everything. And, you know, with things like the, the extended security updates that are available.

You know, there are benefits if you use them with Azure Arc, you can pay monthly rather than annually. So Microsoft are moving people, people that would consider themselves still quite on premises. Microsoft are moving them towards cloud as is Oracle and IBM and everyone else. So I think, I think, you know, there are, there are several others but I think those are probably the biggest trends with Microsoft and of course you know the addition of AI into everything and know core pilots for this that and the other.

Matt (55:53.564)

Rich has been much more interesting than I thought a conversation around licensing would be. So you've certainly opened up my eyes to the importance of getting it right and the options available. One of my particular things I'll take away from this actually is when it comes up to a new rule. I'm looking at what we have and what we need and what we're using. That's a really good point, an obvious point, but. probably something I've not really thought about. You sort of buy the licenses and then sort of never think about it again. So that's really useful. So thank you for joining us on this episode of Mastering

Rich Gibbons (56:32.714)

No problem. Thank you very much for having me. It's been