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R.I.P. AX2012R3

It’s November 2016, and here are the facts:

  • Dynamics 365 for Operations is the next Cloud based AX version, only available in the Cloud
  • Dynamics AX2012R3 continues to be available and supported until 2021 as the on premise option
  • There will be no on premise version of Dynamics 365 for Operations

It’s May 2017, and here are the new facts:

  • Dynamics 365 for Operations will be available in the Cloud and on premise (and something in the middle called ‘Edge’)
  • AX2012R3 will be discontinued for new customers from July 1, 2017

You might accuse Microsoft of indecision and not knowing their own long term strategy.  If you’re more generous, you’d congratulate them for responding to a tidal wave of channel feedback that demanded Dynamics 365 in an on premise form.  Once that decision was made, the lifespan of AX as we know it was short lived.

There is a lot of information out there in the public domain regarding this announcement so I’ll not repeat it all here, but if you’d like to explore some of the detail or how it affects you I’d be happy to discuss.  Here are a few key points:

  • If you’ve looked at the Dynamics 365 licensing and seen the 2 tier options (Operations, and Team member), there is a new license level coming called ‘Activity’ that sits somewhere in the middle.  It should allow the licensing distribution to be a little more balanced.
  • If you are an AX2009 customer, you will no longer be able to transition / upgrade to AX2012R3.  Instead you will need to move to Dynamics 365 for Operations (on premise or Cloud).
  • The cost of the on premise licensing is (roughly) 55% of the Cloud version.  Of course you then need to build the hardware and supporting stack.  I haven’t got the calculator out on this one yet, but it will be an interesting discussion with prospects to evaluate the different ROI’s in each scenario.
  • Existing AX2012 customers can continue to buy licenses and will be supported as per the previous announcements, so long as the Software Assurance (BREP) plan is maintained.
  • Although there is no official closure of AX2012R3 development, I think we can reasonably expect the ‘new features’ focus to be on Dynamics 365 for Operations.

So this looks like the long term picture, and despite the challenges of transitioning to the new product, new licensing and new technology, it would seem better in the medium term if we are working with just one version, albeit with three deployment options:

  1. Cloud
  2. ‘Edge’.  This is a Cloud central deployment but with local off-line capabilities, aimed mainly at Retail but with other niche markets such as remote warehousing.
  3. ‘Local Business Data’.  The on premise version will still require Azure directory integration, but all databases remain local.

With all of our current projects and pipeline based on Dynamics 365 for Operations, Cloud option, it would appear that we will never again deploy a new AX2012R3 system, or even upgrade anyone to that platform.  I first worked on AX2012 on a project in the beta version in late 2011, so it has served us well for 6-7 years now.  But all good things do come to an end and we look forward to the new challenges of Dynamics 365 for Operations – in any form.