Introduction:
As organizations continue to open their services to external users such as customers, partners, and contractors, managing identities beyond the workforce becomes essential. Microsoft Entra External ID is Microsoft’s identity platform designed for customer and partner identity and access management (CIAM), enabling secure and scalable access for anyone outside your organization.
In this post, we’ll explore Microsoft Entra External ID, its pricing model, and how to create an External ID tenant using the Azure portal.
What Is Microsoft Entra External ID?
Microsoft Entra External ID (formerly part of Azure AD External Identities) is a CIAM solution within the Microsoft Entra product family. It allows organizations to:
- Provide secure sign-ins and access control for external users (customers, partners, etc.)
- Customize user journeys
- Enable self-service registration and authentication using social identities, email, or phone
- Integrate with applications via OpenID Connect, OAuth2, or SAML
- Custom Branding
Starting May 1, 2025, Azure AD B2C will no longer be available for purchase by new customers. Microsoft Entra External ID is the future of CIAM (Customer Identity and Access Management) at Microsoft, and all new features and innovations will be built on this modern platform. By adopting Entra External ID from the beginning, organizations can take advantage of a future-ready architecture and benefit from faster feature rollouts and enhanced capabilities.
Pricing:
Microsoft Entra External ID offers flexible and consumption-based pricing, which differs from the per-user licensing model used for internal users.
| Feature | Pricing Tier | Monthly Active Users (MAUs) | Price |
| Core Offer | Up to 50,000 MAUs >50,000 | $0 $0.0163/MAU | Includes basic features |
| Add Ons | $0.75/MAU | Identity Governance |
Monthly Active User (MAU): You’re billed based on the number of unique external users who authenticate in a calendar month.
No double billing: Users can authenticate across multiple apps without being charged multiple times.
Free for the first 50,000 MAUs each month.
Please refer Microsoft Entra External ID – Pricing | Microsoft Azure for more information.
How to Create a Microsoft Entra External ID Tenant in Azure
You can easily create a Microsoft Entra External ID tenant from the Azure portal. Follow these steps:
Step 1: Sign In to the Azure Portal
Go to https://portal.azure.com and sign in using your Microsoft account.
Step 2: Create a New Entra Tenant
- Go to Marketplace, In the search bar, type “Microsoft Entra external ID“ and select it.
- Select the plan as Microsoft Entra External ID> “Create“.
- Under the Basics section, enter Tenant Name, Domain Name, and Country/Region .
- Under the Add a Subscription section, select the subscription and resource group.
- Finally, review and create
After a tenant creation, you can use the Microsoft Entra Admin Center with External ID directory to manage it.
What Can You Do Next?
After creating your Entra External ID tenant, you can:
- Register applications (web, mobile, or APIs)
- Configure user flows or custom policies for signup, sign-in, and profile editing
- Add identity providers like Google, Facebook, GitHub, etc.
- Customize the branding for user experiences
Summary:
In this article, we explored the fundamentals of Microsoft Entra External ID, Microsoft’s next-generation CIAM solution designed to securely manage external identities like customers and partners. We covered:
- What Entra External ID is and why it matters
- Its usage-based pricing model
- Step-by-step instructions to create an External ID tenant using the Azure portal
Whether you’re building customer-facing applications or partner portals, Entra External ID offers a scalable and secure foundation for external identity management.
This post is just the Start. In my upcoming articles, I’ll dive deeper into key features of Microsoft Entra External ID, including:
- Creating and customizing User Flows
- Integrating with social identity providers like Google and Facebook
- Managing application registrations and secure API access
- Implementing branding and localization
Stay tuned as we explore how to leverage the full power of Microsoft Entra External ID for your external user scenarios.
