Microsoft 365 License Management Considerations

IT Asset Management (Cloud)

Microsoft 365 licenses that allow local Office installations also allow you (subject to the chosen plan) to install Microsoft 365 on up to five PCs or Macs, and up to five tablets or smart phones, per Named User license. The following section provides an overview of the tools provided in each enterprise plan.

With the FlexNet Manager for Clients product, you can use IT Asset Management to manage your Microsoft 365 subscriptions. You can:
  • Validate that the desired users have the right plan
  • Determine how many Microsoft 365 licenses you need to purchase, while negotiating license agreements
  • Ensure that business units are not under- or over-subscribed.

Based on the selected plan, a subscription of Microsoft 365 may allow you to access multiple Office applications online as well as offline (local installations) on up to five computers, and five tablets or smart phones. Because of this mixture, the compliance calculations for Microsoft 365 licenses are different than other applications.

For example, the E3 plan allows you to install and use the following applications:
  • Exchange Online Plan 2 for Microsoft 365
  • Skype for Business Online for Microsoft 365
  • Office Professional Plus for Microsoft 365
  • Azure Rights Management for Microsoft 365
  • SharePoint Online for Microsoft 365
  • Yammer for Microsoft 365
Tip: For a detailed description of the available Microsoft 365 subscription plans, and the applications supported in each plan, see the Microsoft 365 website.

Considerations for managing Microsoft 365 licenses

To differentiate user records at various stages of processing, those already recorded within the compliance database of IT Asset Management are here called "compliance users".

  • Users: Each user imported from Microsoft 365 is mapped to the appropriate compliance user record within IT Asset Management (by matching the Email or Alternate email field values). If an imported user cannot be mapped to any compliance user, a new compliance user record is created with a dummy inventory device assigned to it. These users consume against the Microsoft 365 multi-product license created for the Microsoft 365 tenant's subscription.
    Tip: There are frequently differences between a user's corporate email address (such as and the same user's email address registered in Microsoft Office 365 (such as Since only the email addresses are available for matching (given that your Active Directory accounts are not reflected in the Microsoft 365 online service), this can lead to duplicated user records. To avoid duplicate records, you can, prior to importing from Microsoft 365 Online Service, populate your existing user records with the Microsoft 365 email address in the Alternate email field. You may want to consider using a Business Adapter to make widespread updates. If you have not done this prior to importing from Microsoft 365 (and as a result some user records are now duplicated), you can update the Alternate email field in your AD-based records at any time, and the next full import and compliance calculation automatically cleans up those duplicates.
  • Devices: Although the installed device information is available to Microsoft 365 administrators through the Microsoft 365 Admin Center, IT Asset Management imports no device information from Microsoft 365. Instead, imported users are mapped to compliance users within IT Asset Management, and the inventory devices linked to those compliance users are considered to be the accessing devices. The method of linking the inventory devices and users may be any of assigned user, calculated user, or last logged on user (in descending order of priority, and all visible in the Ownership tab of the inventory device properties). The system also handles the following exceptions:
    • Missing device: If an imported user maps to a compliance user who is not linked to any inventory device, a dummy remote device is created by using the naming convention User Name (Remote). Such a dummy device is not treated as a managed device by IT Asset Management (and specifically, does not count as a licensed device for the license for IT Asset Management itself).
    • Installations on extra devices: If an installation of Microsoft 365 is detected on a device, and the device is not linked to any compliance user matched to a user imported from Microsoft 365, the installation consumes from an existing perpetual license.
  • Mobile devices: Because IT Asset Management does not collect inventory from all mobile devices (such as iPads), you may need to monitor these devices separately. You can get the details of installed devices from the Microsoft 365 Admin Center. If this reveals too many devices where a single named user is authoring or editing Microsoft 365 documents, you may need to deactivate Microsoft 365 from one (or more) of the mobile devices.
    Tip: You can read or present documents on a deactivated copy of Microsoft 365.
  • Local installations: A Microsoft 365 subscription is represented as a Named User license, with each user permitted to have installations on multiple devices. Only Microsoft manages the access to Microsoft 365. Separately, if imported inventory identifies a local installation related to Microsoft Office on an inventory device within your enterprise, the compliance user linked to the inventory device is checked. If this compliance user is matched in the subscription for Office 365, IT Asset Management assumes that the software installation is licensed. If the device user is not matched in the subscription for Office 365, IT Asset Management looks for an existing perpetual license to cover this installation.
  • Office versions: A perpetual license of Microsoft 365 enables you to downgrade to an earlier version, but the subscription license does not. If you have a perpetual license of the older Office version, and you buy a subscription, the license validity of the older version gets extended until the subscription expiry date.
  • License entitlements: The entitlements data for Microsoft 365 is directly imported from Microsoft 365. When an import matches an existing license record for Microsoft 365, its available entitlements are adjusted with each import. On the other hand, if no license exists for an imported subscription to Microsoft 365, a new Named User license is created for each subscription owned by each Microsoft 365 tenant, and the available entitlements are recorded there. In the license properties for this automatically-created license:
    • The Duration value (on the Identification tab) is set to Subscription.
    • Initially, no purchases are linked (on the Purchase tab), since your entitlements are imported from Microsoft 365. Should you wish to link purchases to this automatically-created license (for example, as a way of independently keeping track of your subscription purchases), notice that the value of the Assigned column is set to 0 (that is, the effective quantity on any linked purchases does not affect your total entitlements in the usual way). As well, the Entitlement status column displays Not contributing, to again remind you that for such a license, the compliance calculations are based entirely on the entitlement figures imported from Microsoft, rather than on purchase records.

IT Asset Management (Cloud)