Corporate News

Microsoft Teams pricing and licensing model changes

On October 1, 2023, Microsoft made a change to the licensing model for Microsoft Teams in the European Economic Area (EEA) and Switzerland.

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Why was the license model changed? 

The reason was an inspection by the European Commission under antitrust law. The change was approved by the European Commission, which had concerns that Microsoft Teams was too dominant in the enterprise sector. The Commission argued that customers are now free to decide whether they want to use Microsoft Teams or not. Previously, Microsoft Teams was included free of charge in the Enterprise licenses, such as Office 365 E1/E3/E5 and Microsoft 365 E1/E3/E5. As a result of the change, Teams is now a separate license that must be purchased separately.

What does the licence change mean for companies?

The change primarily affects new Microsoft 365 customers who have to decide whether they want to add Microsoft Teams to their Enterprise license for a cost. If they decide to use Teams, they will have to purchase a separate license. The price for the Microsoft Teams EEA license is currently 5 euros per user per month or 60 euros per year. 

If customers do not wish to use the program, they can purchase an Enterprise license without Teams. These are then cheaper than the previous Enterprise licenses with Teams. Existing customers with Enterprise licenses will not initially be affected by this change. Their current subscriptions will remain unchanged until they need to be renewed or changed. At that point, they will have to decide whether they want to continue using Microsoft Teams or switch to an Enterprise license without Teams. 

What alternatives are there from Microsoft Teams?  

In light of the changes to the Microsoft Teams license model, customers should carefully consider whether the additional cost of purchasing Teams is justified. This is a good opportunity to evaluate existing alternatives such as Cisco Webex, which could now provide a more cost-effective and functionally equivalent or even superior solution. This review is critical to ensure that the chosen collaboration platform meets both the financial and technological requirements of the organization. 

In summary, the change to the license model for Microsoft Teams in the EU has an impact on all customers who use Microsoft 365 or Office 365. The flexibility for customers increases. They now have the choice to use Microsoft Teams, but must consider whether they want to purchase a separate license. 

Further information can be found on the Microsoft website and blog.