Named User Licensing

Microsoft CRM is licensed on a named user basis. This means that you assign licenses to specific users by name and, as long as a user is assigned to the license, the license is occupied: even when the user is not actually using the system. This is in contrast to the other popular CRM licensing method known as concurrency. With concurrency, you purchase a set number of licenses and the system will not allow access to more users than that number.

Concurrency models provide the benefit that the company pays only for the licenses it is actually using. However, the downside of this benefit is that it can encourage the company to limit access to the system. The tendency inevitably is to come up with the least number of concurrent users necessary to keep the system available for the power users. Those nonpower users may be denied access from time to time and lose interest in adopting the system.

The obvious downside to the named user model is that the company must purchase a license for every user who needs access to the system. However, the benefit of this model is that because it is an “all you can eat” concept it encourages the user to access the system as much as possible. Or, perhaps more appropriately, it encourages the company to encourage the users to access the system as much as possible. This is consistent with the CRM philosophy. The more the CRM system is used by the people actually touching the customers, the more useful a tool it will be.