Simplify multi-tenant licensing with a single Microsoft Entra ID license
A multi-tenant environment is an organizational structure where multiple separate groups, known as tenants, share a common IT infrastructure. Each tenant typically represents a distinct branch or unit within a company (such as subsidiaries, regional offices, or recently acquired companies) or entirely separate companies that need to collaborate. While each tenant operates independently in terms of data, settings, and user access, they all benefit from shared resources and services. This model allows for flexibility, security, and scalability, but traditional licensing for each tenant can quickly become complex and costly.
To simplify this, Microsoft recently introduced multi-tenant organization (MTO) capabilities through Microsoft Entra ID. This innovative approach enables organizations to license multiple tenants under one single license per employee, streamlining management and significantly reducing licensing costs.
Key licensing benefits of Microsoft Entra ID in multi-tenant environments
With multi-tenant functionality, a single Microsoft Entra ID Plan 1 license is sufficient to cover each employee across all tenants in an organization. Here’s how this simplified licensing model supports organizations:
- One license per employee: Organizations no longer need to acquire separate licenses for each tenant. As long as an employee is covered by a Microsoft Entra ID Plan 1 license, they can access and collaborate across all tenants in the organization.
- Viva Suite and Employee Communications SL for Viva Engage: For organizations leveraging Viva Engage for inter-tenant communication and community building, an Employee Communications & Communities User SL or Viva Suite license is required to unlock MTO capabilities. This allows employees to engage in cross-tenant events, discussions, and campaigns, streamlining internal communication across tenant boundaries.
- Cross-tenant security and collaboration rights: The multi-tenant licensing structure extends beyond basic collaboration, covering enhanced security and cross-tenant management through Microsoft Defender XDR and Microsoft Teams. This allows organizations to manage incidents, investigate threats, and enable seamless team communication without additional licensing burdens.
- Efficiency for administrators: Admins who need to manage multiple tenants can do so under a single license, allowing them to securely switch between tenants without requiring multiple administrative licenses. This setup benefits global admins with distinct accounts for different tasks, as they can manage and operate across tenants efficiently.
Important details on license eligibility and use rights
The Entra ID Plan 1 and Plan 2 licenses, as well as governance features within Entra ID, are essential for MTO use. While some specific functionalities related to Teams and Viva Engage are not yet fully detailed in Microsoft’s official product terms, Microsoft has confirmed their availability in recent releases and blogs, making them accessible for eligible MTOs.
Example scenarios that leverage MTO licensing
- Organizational mergers: When one organization acquires another, a single Entra ID Plan 1 license per employee covers all tenants, allowing employees across both companies to collaborate without needing additional licenses for each tenant.
- Cross-system access: Employees who need access to systems within subsidiary companies or other organizational units can do so securely with multi-tenant rights, without duplicating licenses for each access point.
- Centralized security oversight: Microsoft Defender XDR enables security administrators to manage and monitor incidents across all tenants, consolidating security under one license per admin without requiring tenant-specific security licenses.
Implementing your multi-tenant license structure
To get started with Microsoft Entra’s multi-tenant licensing, follow these steps:
- Form your multi-tenant organization: In the Admin Center, navigate to Organization Settings → Multi-tenant collaboration and invite relevant external users to create a unified organization.
- Enable cross-tenant sync: Use the Entra Admin Center or Microsoft 365 Admin Center to scale user provisioning across all tenants, ensuring all licensed employees have synchronized access.
- Ensure licensing prerequisites: Confirm that the necessary Teams client and cross-tenant settings are enabled for all employees under the Entra ID Plan 1 license, allowing seamless cross-tenant functionality.
Unlock cross-tenant efficiency with one license
By leveraging Microsoft Entra ID’s multi-tenant licensing capabilities, organizations can reduce costs and administrative complexity while enhancing collaboration across all tenants. With just one Entra ID Plan 1 license per employee, plus optional Viva licensing for Viva Engage, businesses can achieve a cohesive, secure, and streamlined multi-tenant environment.