Microsoft Licensing Shake-Up: Why Teams is No Longer Included

In April, Microsoft announced that they have unbundled Teams from the Office suite for all net new Enterprise subscriptions effective August 1, 2024.  Customers with existing Enterprise subscriptions, fear not!  Existing Enterprise subscriptions will continue to be bundled with Teams for now (no announced end-of-sale date).   


Why are new Teams subscriptions now sold separately?

Microsoft is removing Teams from Enterprise subscriptions because of a European Union investigation that began in July of 2023, in response to a complaint filed three years prior by Slack.  The complaint alleged that by including Teams with the Office Suite, Microsoft was "abusing its market dominance to extinguish competition in breach of European Union competition law."  Instead of a costly court case, Microsoft chose to proactively remove Teams from enterprise Office suites back in October of last year for customers in the European Economic Area (EEA) and Switzerland.  Microsoft claims that standardizing this change globally will streamline decision-making and negotiations for enterprise customers. 


What does this mean for existing Enterprise licenses?

For all new and existing enterprise customers who need to start a new enterprise subscription, Microsoft has released an add-on SKU called Microsoft Teams Enterprise. This add-on license will cost $5.25 per user, per month. You will have the option to remove Teams from Enterprise subscription at a discounted rate of $1.25-$2.25 per user, per month.


See the table below for details on all the enterprise subscription changes: 


Microsoft Enterprise Licensing Subscription Changes 2024 

Do note that in certain circumstances subscribers may be forced into the new Teams-less subscriptions. These circumstances include: 

  • Changing from an Enterprise agreement (500 user minimum) with Microsoft to a Cloud Solutions Provider subscription or vice versa. 
  • Changing the billing frequency from the current option to any of the following: annual upfront, annual billed monthly, or month-to-month. 
  • Allowing a subscription to expire or temporarily reducing the license count to zero for a grandfathered Enterprise subscription. 



Do these changes affect other types of Office subscriptions?  

It's important to note that the changes described in this article only impact commercial SKUs.  Consumer, Academic, US Government, and Nonprofit Office suites are not currently impacted.

Business and Frontline subscriptions will still include Teams with the Office Suite, but now customers will have the option to purchase new Office subscriptions without Teams should they prefer alternatives like Slack, Google Workspace, or Zoom.  See the table below for details: 

Frontline Worker & Business Subscription Updates



Moving Forward Under New Licensing Structures

Microsoft 365 licensing is complex and often confusing, and you want to be certain you are only paying for the Microsoft 365 products your team is using.

Five Nines licensing experts are here to help! If you are a Five Nines partner, please contact your account manager with any Microsoft 365 licensing questions.

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