Hi,
You need a license to assign to each user (person) that accesses the service. For example, if you have 300 unique employees (persons) that will access AAD P1, then you need 300 licenses. External users, if you have any, are licensed differently (see Product Terms). Excerpt from Universal Product Terms for Online Services:
Licensing the Online Services
Customer must acquire and assign the appropriate subscription licenses required for its use of each Online Service. Each user that accesses the Online Service must be assigned a User SL or access the Online Service only through a device that has been assigned a Device SL, unless specified otherwise in the Online Service-specific Terms. Subscription License Suites describes SL Suites that also fulfill requirements for User SLs. Customer has no right to use an Online Service after the SL for that Online Service ends.
Excerpt from Product Terms - Glossary:
Licensed User means the single person to whom a License is assigned.
It is critical for you to read the Product Terms for your specific licensing program since there are many important details not included in the excerpts above. You can find them at the page below:
https://www.microsoft.com/licensing/terms/productoffering/MicrosoftAzure/all
If the above is helpful please Accept Answer.
Thanks.
-TP