Is Teams Part of Office 365? Here’s What You Need to Know About Recent Microsoft Licensing Changes

Microsoft just made a significant change to how Teams is licensed for enterprise plans.

Microsoft has unbundled Teams from its enterprise Microsoft 365 and Office 365 plans globally. You will no longer be able to purchase Office 365 E1, E3, E5 or Microsoft E3, and E5 suites with Teams included.

This shift, effective immediately for all new enterprise subscriptions, stems from competitive fairness concerns raised in Europe last summer, prompting a reevaluation of how Teams is bundled.

With 320 million monthly users across the globe, Microsoft Teams license news is important to the hundreds of thousands of organizations that use the collaboration tool every day.

We will provide you with the key details of this change, helping you understand the impact on your organization as you navigate the new Microsoft 365 and Office 365 license landscape.

Teams Unbundled from New Enterprise Licenses

For anyone purchasing new enterprise licenses, Teams will no longer be included. Instead, Teams is transitioning to a standalone product known as Microsoft Teams Enterprise.

The key word here is new—existing customers won't feel the impact of these changes, but this also allows for the opportunity to evaluate Microsoft 365 and Office 365 licensing as additional product offerings, like Teams Enterprise, could change your overall strategy.

Additionally, this licensing change does not affect SMB and Frontline licenses. If you are using a Business Basic, Standard, Premium, or Microsoft F1/F3 license, Teams will still be included in your license renewal. Additionally, there is now the option to purchase these licenses without Teams.

Microsoft Teams Licensing Questions

Q: When can existing customers remove Teams from their licenses?

A: Only during your renewal period, unless you choose to upgrade to a specific plan that excludes Teams.

Q: How do I know if I’m an existing customer?

A: If you had an active license with Teams included before April 1, 2024, then you are an existing customer.

Q: What happens if I switch Cloud Service Providers?

A: Currently, switching partners makes you a “new” customer to Microsoft, impacting Teams access upon renewal.

Q: Can I add standalone Teams Enterprise seats now?

A: Yes—and there is no minimum for these add-ons.

Q: Will I be able to mix bundled and unbundled suites?

A: Absolutely. You can have a mix of subscriptions with and without Teams within the same tenant.

Q: Does this affect government, academic or non-profit customers?

A: As of now, these industry sectors are not affected by the unbundling of Teams.

Use This Opportunity to Optimize Your Microsoft Licensing

Microsoft licensing can be complex, and considering switching up your Microsoft licensing strategy can be an added nuisance. However, use this as an opportunity to reassess all of your tools. Teams is great, but it isn’t your only option. There could be a better fit for your organization’s unique demands.

At HBS, we understand that Microsoft licensing can be overly complex. We’ve helped many organizations navigate these changes. We know how to help optimize Microsoft’s tools to best serve your business. If you’re unsure if Teams is right for you, and want to explore other collaboration tools? Let’s talk.

Our job is to find you the best fit, ensuring your team has exactly what it needs to drive your business forward without overspending. Connect with us today to start mapping out your licensing strategy.