Azure Group-Based Licensing fits a nice need for organizations. This now allows licensing of users in Office 365 without an admin, either directly via the Admin Portal or via PowerShell, adding licenses to the user directly. Group-Based licensing instead applies licenses to a user based on their group membership. This works with sync’d groups, so a help desk tech can create a new user in on-premises Active Directory and then add the new user to a specific group, once sync happens, the user will be created in Office 365 and have the licenses assigned.

This does require that the user has at a minimum Azure AD Basic licensing and that currently all of the setup for Azure Group Based licensing is done via the Azure Portal and not in the Office 365 Portal. Below I have walked through setting up Azure Group Based Licensing. Is this demo below I did not use a sync’d group, but just created an Online Security Group ‘License Test’.

More information about Azure Group-Based Licensing can be found here:

For this demo, I also added a trail of Azure AD Premium Plan 1 to my Office 365 Tenant. You will also need to setup an Azure Subscription, and have it associated to your Office 365 Tenant. The best way to do this is from the Office 365 Admin Portal, under Admin Centers click on Azure AD. This will take you to the Azure Portal and if needed setup your Azure Subscription.

  1. From the Microsoft Azure Dashboard, select Azure Active Directory

  1. Go to the Azure Active Directory area within your Azure Subscription and click on Licenses

  1. Click on All Products and select the licenses you want to be part of the Group-Based Licenses, then click on Assign at the top

  1. Click on ‘Configure required settings’ and search for the group you want to assign the licenses too; select that group click on Select at the bottom

  1. Click on Assignment Options to make any changes to the licensing assignments and click OK

  1. Click on Assign at the bottom

  1. You will see a Notification, click on the Bell to verify the Group Licensing Assignment completed

  1. Created new user, initially added a Azure AD Premium license to get the account created then removed the license

  1. The I added the Test User to the License Test group

  1. Now the user has licenses assigned

  1. From the Azure Portal this is what is seen

There you have it, a quick overview of Azure Group Based Licensing. Once you setup the Group licensing settings, applying licenses to a user is as easy as adding them to a group. Again for more information about Azure Group-Based Licensing, go here: