Power BI offers several back-end platforms to customers, including multiple cloud services and an on-premises version. The platforms vary by licensing model and support for content types, client tools, data hosting, features, performance, scaling, and security.

This article will discuss Power BI’s back-end platform, subscriptions, capacities, users, and licenses. We will also compare capacities and licenses and how they affect the offered features and functionalities.

This article is a part of the multipart series on the Power BI ecosystem and continues the concepts introduced in the introduction article.

Demystifying Power BI — Understanding Power BI Ecosystem and Landscape

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The back-end platform is the backbone of Power BI. The back-end platforms act as repositories for the following components:

• Power BI reports and paginated reports
• Excel and CSV files
• Datasets, dataflows, and datamarts
• Analysis Services Tabular data models

They are also the workhorse for numerous activities, including the following:

• Authenticating users, applications, and data connections
• Executing queries and controlling data refresh schedules
• Pulling data from various sources via connectors and gateways
• Processing data integration pipelines
• Rendering and exporting reports
• Publishing and distributing reports and dashboards
• Responding to real-time user interaction
• Interfacing with applications

The back-end platform is also what developers refer to as Premium or Capacity. These terms are often used interchangeably, but they refer to two different aspects of the Power BI platform.

Capacity refers to a pool of finite computing resources. In contrast, Premium refers to a subscription-based license that gives an organization the sole right to use a set of resources along with additional features and functionalities that come with the license.

Back-end Platform Types

Unarguably the most widely used and well-known Power BI platform is the Power BI service on the cloud. Power BI is also available in an on-premises flavor with similar features. Let’s categorize the Power BI back-end platform based on the responsibility of managing and availability of the computing resources.

1. Power BI on-premises: Power BI Report Server is an on-premises offering of Power BI for publishing, sharing, and consuming business intelligence content within the corporate network on an on-premises data center. Power BI reports are deployed and delivered in an on-premises portal alongside Reporting Services paginated reports, Excel reports, and Mobile reports. Although it is built on top of SQL Server Reporting Services and has a superset of its functionality, Power BI Report Server is a different product from SQL Server Reporting Services and is licensed and installed separately.
2. Power BI service: Power BI service is the cloud-based software-as-a-service offering of Power BI. Power BI service supports collaboration, sharing, enterprise distribution, creation of dashboards, and additional functionality such as alerts and scorecards. It can serve as a central location to consolidate the distribution of datasets for content creators and reports, dashboards, and Apps to consumers.

Capacities

In the Power BI service, content, components, and features are organized into workspaces, and workspaces are created on capacities. Capacities represent a set of resources (storage, processor, and memory) used to host and deliver the Power BI content. Capacities in the cloud are further divided into two kinds:

• Shared capacity (aka multi-tenancy mode): When a Power BI tenant is created, initially, it has one capacity available: Power BI shared capacity. The resources supporting the shared capacity are shared with other Power BI customers (multi-tenancy). To ensure “fair play” among all the customers of the shared capacity, Power BI imposes certain limits and throttles. Such as the maximum size of a dataset, the maximum number of dataset refreshes that can take place in a day, etc.
• Dedicated capacity (aka Premium): In contrast to the shared capacity, a dedicated capacity is reserved for a single Power BI customer. Dedicated capacity requires a separate subscription known as Premium. When customers purchase Power BI Premium, they buy one or more Power BI Premium capacity nodes. A Power BI Premium capacity node can be considered a virtual machine: a specified amount of computing resources to be used by one customer within the Power BI service. Unlike shared capacities, Premium capacities have relaxed limits.

Licensing

To understand how licensing works in Power BI, first, we need to understand user types and types of licenses in Power BI.

Power BI User Types

From a licensing perspective, Power BI defines two types of users:

• Creators: Creators are individuals who build and share content, such as Power BI reports and datasets. Creators are usually a small set of users, including report authors, data analysts, administrators, and content curators. Power BI defines content creators as anyone who creates or contributes to the creation of content that is published to a Power BI back-end platform.
• Consumers: Consumers are individuals who access reports and datasets for read-only purposes, including viewing and performing individual analysis and filtering. Content consumers are usually the largest group of Power BI users, including management, financial analysts, and sales staff. They access reports through the Power BI portal, mobile app, in-house apps, or webpages.

Licenses in Power BI fall into three categories: per-user licenses, capacity-based subscriptions, and server-based licenses. As a rule of thumb, every user onboarded to the Power BI service requires a license. However, Power BI Report Server users are exempted from this requirement. Additionally, every content creator requires a user license, whereas the hosting Power BI back-end platform determines the license for consumers.

User-based Licenses (User Subscriptions)

User licenses are assigned to individual users in an organization. Every user starts with the Power BI Free license and later gets upgraded to other user-based licenses.

Power BI Free: Power BI Free is a free consumer offering that makes the Power BI service available for personal use. The free service does not permit sharing content, does not have access to most analytic features in Power BI, and provides limited security controls.

As a creator, users with a free license can only publish content to their “My Workspace” in the Power BI service for personal use. As a consumer, users with a free license can view the content hosted in a Premium capacity.

Power BI Pro: Power BI Pro license allows access to all content and capabilities in the Power BI service, plus the ability to share and collaborate with colleagues. Pro users can use all capabilities and features associated with workspaces. A Power BI Pro license is one of the creator licenses for sharing, collaboration, and content distribution in Power BI.

As a creator, users with a Pro license can publish content to shared or dedicated capacities for sharing and distribution across the organization. As a consumer, Pro users can access content hosted in shared or dedicated capacities created by other Pro users. However, it’s worth mentioning that Pro users can’t publish or consume content from workspaces assigned to the Premium Per User licenses.

Power BI Premium Per User (PPU): Premium Per User license is another creator license in Power BI and is designed to provide Premium features per-user basis. PPU includes all Power BI Pro license capabilities and Premium-only features such as paginated reports, AI capabilities (such as AutoML, Impact Analysis, and Cognitive Services), XMLA endpoint connectivity, etc. PPU is the lowest entry point for Power BI Premium features and is built upon a Premium capacity node equivalent to SKU P3. However, unlike Premium capacity nodes, PPU does not require memory or CPU management by the organization.

As a creator, users with a Premium Per User license can publish content in all capacities for distribution across the organization. As a consumer, PPU users can access content hosted in all kinds of capacities and workspaces.

The following tables summarize the hosting capacity’s capabilities and consumer license requirements.

Further reading on features by license type.

Capacity-based Licenses (Tenant level Subscriptions)

Capacity-based licenses give an organization the right to use a dedicated resource (called a capacity node). After a capacity node has been purchased, the resources it provides must be configured as one or more Premium capacities within the Power BI service. Workspaces are then hosted on these Premium capacities enabling them to take advantage of additional features and relaxed limits.

Power BI Premium: Power BI Premium includes many additional benefits and features, as well as the capability to distribute read-only content to report consumers with Power BI Free licenses. Premium is aimed at organizations with a more significant number of read-only users, more extensive data volumes, to meet security or compliance requirements, and highly demanding data and AI requirements. In addition, Premium is a cost-effective licensing option when many read-only users only need to view (rather than create their own) content.

Power BI Premium requires a monthly or yearly commitment and is available in two tiers, each divided into several SKUs. Each of the two tiers is intended for different use cases.

• P SKUs (P1-P5): The P series supports the full array of features and functionality offered by Premium. P SKUs support the embedding for your organization and include a license to install Power BI Report Server on-premises.
• EM SKUs (EM1-EM3): EM series is intended for use with embedding for your organization scenarios and provides embedding capabilities for an organization’s in-house applications, web portals, Microsoft 365 apps, etc.

The following table lists the important differences between the P and EM series.

Power BI Embedded (PBIE): Power BI Embedded (A SKUs) is an Azure offering for Independent Software Vendors (ISVs) who intend to include Power BI content within their customer application. Power BI Embedded addresses the embed for your customers’ scenario. With Power BI Embedded, the customer application manages user authentication, so application users themselves do not need Power BI licenses to access the embedded content.

One big difference between Power BI Premium and Power BI Embedded is that the Power BI Embedded service can be paused when it is not in use. While the service is paused, no user queries can be served, and there are no billing charges.

Server-based License

In Power BI, a server-based license refers to the rights to install an on-premises Power BI server for reporting purposes. The server is available through two licensing options and cannot be purchased individually: Power BI Premium subscription and SQL Server Enterprise Edition with Software Assurance (SA).

Power BI Report Server: Power BI Report Server is a reporting portal that supports the delivery of paginated reports alongside Power BI reports, Excel reports, and mobile reports. It is a basic reporting portal that offers an alternative to the Power BI service for publishing and consuming reports. The features available in the Power BI Report Server are a subset of features available in the Power BI service.

The following table shows a high-level summary of the capabilities available per license type.

User Licensing Rules

Now with an understanding of user and capacity licenses, we can summarize the licensing requirements as follows:

1. Creators always need a user license

• Creators publishing to Premium Per User workspaces must have a Premium Per User license
• Creators publishing to any other back-end platform can have either a Pro or Premium Per User license

2. Consumer licensing is determined by where content is hosted

• Consumers accessing the content in Premium Per User workspaces require a Premium Per User license
• Consumers accessing the content in shared Pro capacities require either a Pro or Premium Per User license
• Consumers accessing the content in any capacity-based platforms do not require a named user license

That’s all about capacities and licensing. Take a break and answer the following question. Can you embed Power BI content that is not hosted on a Premium capacity?

Conclusion

Power BI offers multiple back-end platforms to address hybrid use cases and fulfill data residency and compliance requirements. In addition, power BI provides various licensing options to manage user and organization requirements while keeping the costs predictable.

In this article, we briefly talked about the cloud and on-premises-based Power BI platforms. Then, we looked at different capacities and licensing options available in Power BI.

Next in series

In the next article, we talk about the data management capabilities of Power BI. We will discuss the types of data models, storage modes, connectivity modes, data cleansing, and refresh options in Power BI.

Demystifying Power BI — Data Management

We have another article about report types, report design, and data modeling tools in Power BI.

Demystifying Power BI — Data and Report Design Tools

If you’re curious to learn about the client applications and sharing options for the end-users or APIs, interfaces, and embedding options available to developers in Power BI, then we have the perfect article for you.

Demystifying Power BI — User Applications & Interfaces