What is Microsoft Dynamics CRM External Connector License?

The External Connector License is only necessary when external users access
data. The term “external users” means that users are not:
• The organization's employees
• The organization's contractors or agents
• Employees of a company affiliated to the organization
• Contractors or agents of a company affiliated with the organization
For example, an organization cannot set up an external connector license for
users in a call center environment.

Example A - License required
An organization must have an External Connector License if it wants to create a
web site where the organization's customers can view and maintain their contact
information that is stored in Microsoft Dynamics CRM.

Example B - License not required
An External Connector License is not required if an organization wants to create
a web site that only displays a form that allows the public to enter information
that will be saved in Microsoft Dynamics CRM. The key difference is that in
Example A, the external users have access to Microsoft Dynamics CRM data. In
Example B, external users will enter data that is saved in Microsoft Dynamics
CRM, but they do not have access to Microsoft Dynamics CRM data.