At the beginning of July, Microsoft made a significant announcement about pricing and licencing updates to its popular Power Apps platform. In a blog post, the company announced that it would be reducing the price of Power Apps licences by 50%.

That is certainly the kind of news that puts a smile on your CFO’s face!

But we think the real impact of the new PowerApp licencing model will be felt by citizen developers. Let’s see why.

Microsoft Power Apps licencing reduction

Microsoft explained that, from October 1st, all Power Apps licences would be reduced by half. There are two flavours of Power Apps licences:

  • The Power Apps per user plan: These will be reduced from $40 per user per month to $20 per user per month (or around £14.70 at the time of writing).
  • The Power Apps per app plan: These will be reduced from $10 per user/app/month down to $5 per user/app/month (or around £3.70 at the time of writing).

These new fees will kick in from October 1st, although Microsoft also provided a number of promotional offers which companies may be eligible to apply for. These will give them access to those lower fees in advance.

Do note that, since these prices won’t kick in until October, the Power Apps pricing on the main Microsoft website still displays the older fees.

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Why did Microsoft reduce the prices?

Microsoft hasn’t explained the exact reasons why they decided to reduce the Microsoft Power Apps licencing. However, there is some speculation that it is to address competition in the market from other citizen development technologies. There are many software firms offering citizen developer tools and so Microsoft’s price reduction is potentially an attempt to stake its share of a market that’s expected to grow rapidly in the coming years.

Another possible reason for the reduction in Power Apps license fees is that the older price plans were somewhat confusing. With the existing plans, customers were effectively running three apps, but from October it will be possible to just run one app or one portal.


What this price reduction means for citizen developers

In the past few years, we have seen a big expansion in the citizen developer concept. By using platforms like Microsoft Power Apps, anyone with a basic understanding of business processes and app logic can use a drag and drop system to create simple yet functional applications that their colleagues can use.

Citizen development means companies can:

  • Create functional apps which don’t cost much time or effort to build
  • Save money – building a Power Apps app costs a fraction of the fees associated with getting an app built from scratch by developers
  • Build helpful apps that wouldn’t otherwise get made, due to the costs

The number of people using citizen developer tools like Power Apps has been growing steadily for many years and this trend was given a further push during the coronavirus pandemic. When many more people were working from home, being able to build useful apps has been beneficial for things like:

  • Booking desks at the office
  • Finding out where staff are physically located
  • Reporting on health or other issues
  • Creating apps for frontline staff so they can socially distance
  • Remote employee onboarding for new staff
  • Using digital rather than paper signatures

Microsoft’s announcement about the reduction in Power Apps licence costs will surely only encourage more innovation. Thanks to the price drop, individual users will be encouraged to produce more apps without it costing their companies as much money.

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Controlling your IT spend is harder than ever

Microsoft’s announcement around the reduction in licence fees for Power Apps is certainly welcome news for CFOs. Nevertheless, this doesn’t change the fact that many companies are still paying more than they need for their enterprise software. In fact, according to better cloud in the UK, 38% of IT spend goes on technology that is either unused or rarely used.

And that is why we launched ERA³, our new cost controller tool. ERA³ is a new Software-as-a-Service cost controlling tool which automatically monitors which SaaS applications your end users log into during their working weeks. If ERA³ notices that some of your licences are simply being unused, it will alert your IT department who can decide whether they need to revoke the licence or, alternatively, retrain the employee to make full use of the technology available to them.

It’s all about giving you more control over IT spend

For businesses that frequently use platforms like Microsoft Power Apps, the recently announced reductions in licence fees are without a doubt a positive. But reducing the costs of your existing licences is only one way of controlling your SaaS spending. And the biggest expense – unused licences – is surely the most important part of the puzzle when it comes to controlling costs.

To learn how you can better control your company’s SaaS spend with ERA³, contact us today.