Understand Microsoft Fabric licenses

Microsoft Fabric licenses and capacities determine how users create, share, and view items across your organization. To collaborate, you need an F or P capacity and at least one per-user license. This article explains tenants, capacities, workspaces, license modes, and scenarios so you can plan a scalable deployment.

The following diagram illustrates two common ways organizations can structure their Microsoft Fabric deployment using tenants and capacities. For example, a company can use a single Microsoft Entra tenant for all business units, or separate tenants for different divisions or compliance needs. Each tenant can have one or more Fabric capacities, often aligned to geographic or business requirements.

Core building blocks

This section describes tenants, capacities, and workspaces, which are helpful in understanding a Fabric deployment.

Tenant

Microsoft Fabric runs in a Microsoft Entra tenant. A tenant is associated with one primary DNS domain, and you can add additional custom domains to it. If you don’t already have a tenant, one is created automatically when you acquire a free, trial, or paid Microsoft online service license, or you can add your domain to an existing tenant. After the tenant exists, add one or more Fabric capacities to support workloads. To create a tenant manually, see Quickstart: Create a new tenant in Microsoft Entra ID.

Capacity

A Microsoft Fabric capacity resides in a tenant. Each capacity in a tenant is a distinct resource pool for Microsoft Fabric. The size of the capacity determines the amount of computation power available.

Your capacity lets you:

• Use all Microsoft Fabric features licensed by capacity

• Create Microsoft Fabric items and connect to other Microsoft Fabric items

  Note

  To create Power BI items in workspaces that aren't My workspace, you need a Pro license.

• Save your items to a workspace and share them with a user that has an appropriate license

Capacities use stock-keeping units (SKUs). Each SKU provides Fabric resources for your organization. Your organization can have as many capacities as needed.

The table lists the Microsoft Fabric SKUs. Capacity units (CUs) measure the compute power for each SKU. For customers familiar with Power BI, the table also lists Power BI Premium per capacity P SKUs and virtual cores (v-cores). Power BI Premium P SKUs support Microsoft Fabric. A and EM SKUs only support Power BI items.

Power BI embedding scenarios

In "Embed for your organization" and embedding in Microsoft 365 apps (SharePoint Online, PowerPoint), F SKUs smaller than F64 require each consuming user to have a Pro, Premium Per User (PPU), or individual trial license to view Power BI content.

For "app owns data" (external application / service principal) embedding scenarios, you can use Power BI Embedded A/EM SKUs or Premium per capacity (P) SKUs without an F64 Fabric capacity. An F64 or larger Fabric capacity removes the Pro/PPU viewing requirement for internal users (viewer role) with only a Free license.

Workspace

Workspaces reside within capacities and are used as containers for Microsoft Fabric items. Each Microsoft Fabric user has a personal workspace known as My Workspace. Create more workspaces to enable collaboration.

Each Microsoft Entra tenant with Fabric has a shared capacity that hosts all My Workspaces and workspaces in Pro or Premium Per User license mode. By default, workspaces are created in your tenant's shared capacity. When your tenant has other capacities, assign any workspace—including My Workspaces—to any capacity in the tenant.

Workspace license modes

Workspaces can be created in (or assigned to) Microsoft Fabric capacities. The workspace license mode dictates which underlying capacity type (Fabric F SKU, Power BI Premium per capacity P SKU, shared/PPU shared pool, or Pro/Free shared) the workspace can use. A Premium Per User (PPU) license mode isn't a Fabric capacity—it uses a shared Premium feature pool and doesn't itself enable Fabric (non–Power BI) item creation unless an F capacity also exists. The workspace license mode determines user capabilities.

Per-user licenses

Per-user licenses let users work in Microsoft Fabric. A Free (Fabric) license is automatically assigned the first time a user signs in to the Fabric portal (if the tenant has Fabric enabled). It lets you create non-Power BI Fabric items only in a workspace backed by an F or Trial capacity. You can choose from three individual license types:

• Free - Automatically granted on first Fabric sign-in (if Fabric is enabled in the tenant). Lets you create and share non-Power BI Fabric items when the workspace runs on a Fabric (F) or Trial capacity. Doesn’t remove Power BI viewing requirements on F capacities smaller than F64.

  Note

  To create Power BI items in a workspace other than My workspace and share them, you need a Power BI Pro or a Premium Per-User (PPU) license, or a Power BI individual trial.

• Pro - A Pro license lets you share Power BI content with other users. Every organization needs at least one user with a Pro or a Premium Per User (PPU) license, if they intend to use Power BI within Fabric. On F SKUs smaller than F64, each user viewing Power BI content must have Pro, PPU, or an individual trial. On F64 or larger, users with only a Free license and a viewer role can view Power BI content.

• Premium per-user (PPU) - PPU licenses let organizations use Power BI Premium features by licensing every user with a PPU license instead of buying a Power BI Premium capacity. PPU is more cost effective when Power BI Premium features are needed for fewer than 250 users. PPU uses shared capacity across the organization, which provides the computing power for Power BI operations.

The following table lists the main differences between the capabilities of per-user licenses. For embedded analytics license considerations, see Capacity and SKUs in Power BI embedded analytics.

Licensing scenario summary

Use this reference to see who can do what.

Next, review purchase options to select the capacity and user licensing mix that fits your rollout strategy.

Related content

• Buy a Microsoft Fabric subscription