Microsoft announces changes to Microsoft 365, Office 365, and Microsoft Teams licensing.  

Last year, Microsoft revised the licensing terms for Microsoft 365, Office 365, and Microsoft Teams in the European Economic Area (EEA) and Switzerland.

This move towards uniform licensing aims to provide clarity for customers, making it easier for them to understand their options and streamline the process of decision-making and negotiation.

These adjustments have meant altering the licensing for Microsoft 365, Office 365, and Teams. Announced on the 1st April 2024 and effective immediately, Microsoft is rolling out 1) a refreshed selection of commercial Microsoft 365 and Office 365 packages that exclude Teams for countries outside the EEA and Switzerland, and 2) a separate Teams option specifically for Enterprise clients in those areas.

Fear not, customers who currently have subscriptions that include Microsoft Teams can keep their existing plans. More information is provided below.

What does this mean for Microsoft 365 Enterprise users?

With the launch of these updated license offerings, new subscribers will no longer have access to Office 365 E1, Office 365 E3, Office 365 E5, Microsoft 365 E3, and Microsoft 365 E5 packages that include Teams. Here’s what this means for customers:

Existing subscribers to the affected packages will be presented with new choices. They can maintain, renew, expand, or upgrade their current subscriptions as before. Alternatively, if they prefer to switch to the newly introduced packages, they can do so when their contract renews or on their anniversary date.

New customers looking to subscribe to Office/Microsoft 365 Enterprise packages who want to include Teams for their users will need to purchase two separate items: a Microsoft 365 or Office 365 suite without Teams, and the Microsoft Teams Enterprise separately.

What does this mean for Microsoft 365 Frontline users?

The current Frontline packages will remain available alongside the updated selection. Customers can select from the existing Microsoft 365 F1, Office 365 F3, and Microsoft 365 F3 suites that come with Teams or opt for the new iterations of these suites that exclude Teams.

What does this mean for Microsoft 365 Business users?

The Microsoft 365 Business packages will be available alongside the new offerings. Customers can continue with the current Microsoft 365 Business Basic, Microsoft 365 Business Standard, and Microsoft 365 Business Premium suites that include Teams or switch to the newly introduced versions of these suites without Teams.

Further details on the new offerings are outlined in Microsoft’s licensing update.

As an accredited Microsoft Solutions Partner, our Microsoft experts are on hand to help you with any Microsoft licensing concerns you may have.

Frequently Asked Questions

Why is Microsoft making changes to its licensing packages?
Microsoft is realigning their global subscriptions to provide consistency to customers and modernise decision-making and negotiations. These updates aim to offer clear choices to customers, while responding to competitive and regulatory landscapes, ensuring that businesses can continue to leverage Microsoft tools in a way that best fits their operational needs and strategic goals.

How will these changes affect my existing Microsoft licensing package?
Customers who are already subscribed to Microsoft 365 or Office 365 packages that include Teams will be presented with additional choices upon renewal. They can choose to maintain, renew and enhance their existing subscriptions as they see fit. Alternatively, they now have the option to transition to packages that exclude teams, or they can add new user subscriptions to either the non-Teams suites or the newly introduced standalone Teams service at any point, including in conjunction with their existing Teams-inclusive packages.

How will the Microsoft licensing changes affect new customers?
From the 1st April 2024, the following changes will take place:

  • New commercial customers aiming to equip their information workers with both Microsoft Teams and the benefits found in the existing Microsoft 365 E3/E5 or Office 365 E1/E3/E5 packages will be required to acquire two separate SKUs (Stock Keeping Units): an E1/E3/E5 (no Teams) suite plus Microsoft Teams Enterprise.
  • Small and medium-sized business (SMB) customers now have the option to select either the current Microsoft 365 Business Basic/Standard/Premium packages that include Teams or opt for the new versions of these suites that exclude Teams.
  • For Frontline employees, there is now a choice between continuing with the current Microsoft 365 F1, Office 365 F3, and Microsoft 365 F3 packages that come with Teams or moving to the newly introduced versions that do not include Teams.

What does this mean for my existing Microsoft Teams environment?
For existing Microsoft Teams users, Microsoft global alignment of Microsoft 365, Office 365 and Teams licensing introduce key changes:

  1. If you’re already subscribed to any Microsoft 365 or Office 365 suite that includes Teams, you can keep using, renewing, upgrading, and adding seats to your existing plans without any interruptions. This ensures that your current operations and collaborations facilitated by Teams remain unaffected.
  2. You have the flexibility to switch to the new lineup of suites without Teams at the time of your contract renewal based on business requirements.
  3. Users can gain more adaptability and choice in how they utilise Microsoft’s suite of productivity tools.

What is the difference between Microsoft Teams Enterprise and Microsoft Teams Essentials?
Microsoft Teams Enterprise offers unlimited access to meetings, chat, voice-over-IP (VOIP) calling, and collaboration features, without any restrictions on the number of users and allows for up to 1000 participants in a meeting.

The Microsoft Teams Essentials package continues as before, delivering meetings, chat, VOIP calling, and collaboration services to a global customer base, supporting up to 300 users and allowing a maximum of 300 participants per meeting.