Exchange Online Adds Support for License Stacking

License Stacking Allows Workloads to Manage Multiple Licenses

Exchange Online

The Exchange Online blog post of January 20 “Introducing Support for Concurrent Exchange Online License Assignments” caused some furrowed brows because on first glance it doesn’t seem like an important announcement. The impact of the change depends on the size of a Microsoft 365 tenant and the processes used for license management. If your tenant is small and licenses are relatively static, you can safely ignore this topic. But those who run large tenants and use features like group-based license assignments are likely to be much more interested.

License stacking means that an Azure AD user account can hold multiple licenses for the same workload. Some of the licenses might be inherited from products (SKUs) that bundle multiple service plans (a not-for-sale license included in a SKU). Others come from specific products or add-ons. For instance, an account might hold the Teams Exploratory license and also have a license for Teams through the Office 365 E3 or E5 SKUs. When license stacking is in place, the workload is responsible for resolving the capabilities made available through the different licenses and allowing the account access to the feature set available from the best (“most superior”) license. In the example above, Teams would respect the license from Office 365 E3 or E5 because it covers more functionality than the Teams Exploratory license.

Exchange Online Licenses

In the case of Exchange Online, four licenses are available:

  • Exchange Online Essentials (BPOS_S_Essentials).
  • Exchange Online Kiosk (BPOS_S_Deskless).
  • Exchange Online Plan 1 (BPOS_S_Standard).
  • Exchange Online Plan 2 (BPOS_S_Enterprise).

BPOS refers to Business Productivity Online Suite, a predecessor to Office 365 based on Exchange 2007.

Microsoft says that they have updated the Get-ExoMailbox (Get-Mailbox) and Get-Recipient cmdlets to give tenants insight into the Exchange capabilities assigned to accounts through the licenses assigned to the accounts. I found that the data isn’t fully populated for all mailboxes (this will happen over time). However, it’s possible to run a command like this to report assignments:

Get-Recipient -RecipientTypeDetails UserMailbox -ResultSize Unlimited | Format-Table DisplayName, RootCapabilities

DisplayName                             RootCapabilities
-----------                             ----------------
Tony Redmond                            BPOS_S_Enterprise
Ben Owens (DCPG)                        None
Andy Ruth (Director)                    BPOS_S_Standard, BPOS_S_Enterprise
James Ryan                              BPOS_S_Enterprise

The Ben Owens account is an example where the assignment information isn’t yet populated. The Andy Ruth account is an example where two licenses are in place that include an Exchange service plan (one for Exchange Online Plan 1, the other for Plan 2). In this case, because Exchange Online Plan 2 enables more functionality than Plan 1, it’s the one that Exchange Online respects.

Concurrent License Assignments for Exchange Online

Traditionally, Exchange Online has not supported license stacking, which means that an Azure AD account can hold a single Exchange Online license. Most of the time this doesn’t matter because the usual situation is for an account to receive an Exchange Online license through a product SKU. For instance, Office 365 E3 and E5 both include the Exchange Online Plan 2 service plan.

However, it’s possible that an account might start out with a Microsoft 365 Business Basic license that includes Exchange Online Plan 1. The account belongs to a user who’s promoted to a management position that the organization requires to come within the scope of a retention policy and have an online archive. These features require Exchange Online Plan 2, so the organization removes the Microsoft 365 Business Basic license and assigns the account an Office 365 E3 license.

Exchange Online mandates that all user mailboxes have licenses. When the organization removes the Exchange Online Plan 1 license from the account, a chance exists that Exchange Online might soft-delete the mailbox and make it unavailable. The mailbox becomes available again when the account gains the Exchange Online Plan 2 license through Office 365 E3, but it’s not a great situation to be in if a user loses access to their mailbox while license administration is in progress.

Why Exchange Online License Stacking is Helpful

Support for license stacking (multiple concurrent licenses) means that the organization can assign the superior license to the account before removing the other license. This might happen through an automated process. For instance, a group-based licensing assignment might occur and assign the license because of the user’s new job means that they join a group. Later, another process might remove the inferior license from the account to return it to the unused license pool. Automated license assignment by reference to a property of Azure AD accounts is very common, both through Azure AD group-based assignment and purpose-built license management tools. Organizations often go down this route because of the complexity that’s sometimes found in understanding the combinations and permutations available in Azure AD licensing.

Group-Based Licensing for All

In August 2021, as part of their announcement about the retirement of the license assignment cmdlets in the Azure AD and MSOL PowerShell cmdlets. Microsoft promised to remove the additional licensing requirement for group-based licensing. That hasn’t happened yet because Microsoft has had to delay the move to the new licensing platform for Microsoft 365.

The current schedule deprecates the licensing cmdlets on March 31, 2023, and perhaps this will mark the point when Microsoft allows everyone to use group-based licensing. If you haven’t already migrated PowerShell scripts that do license management to the Microsoft Graph PowerShell SDK, it’s time to get going.

Good Housekeeping Change

Microsoft is rolling stacked licenses support for Exchange Online in  the commercial clouds. Government clouds are next and will be done by the end of H1 2023. It’s not an exciting change, but it’s a good example of a housekeeping enhancement that will stop users losing access to their mailboxes due to internal license management.

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