April 15, 2024

Microsoft Announces Changes to Teams in M365/O365 License Subscriptions: What You Need to Know


Nick Beacroft | Licensing & Optimisation Lead | 30+ years in technology


In a recent update, Microsoft announced changes to its Office license subscriptions, particularly impacting commercial customers. Effective 1 April 2024, Microsoft will be removing Teams features from new Office E1/E3/E5 and Microsoft E3/E5 license subscriptions.

What does that mean for you and your organisation?

First and foremost, existing subscriptions remain unaffected by these changes. If you currently have a subscription inclusive of Teams features, your service will continue as usual, with no interruptions expected upon renewal.

For those considering new subscriptions, there are some implications. The pricing for the 'no Teams' E1, E3, and E5 licenses is lower, however, if you opt to add Teams Enterprise features, you can expect a combined price increase of approximately NZ$4.80 per user, per month.

As of now, organisations still have the option to provision new subscriptions inclusive of Teams features. However, it's essential to note that Microsoft reserves the right to remove this option at any time. Our expectation is that this provision may continue until 1 May 2024, but it’s worth keeping an eye out for new updates from Microsoft.

Additionally, it's worth mentioning that other frontline and non-Enterprise licenses, such as Microsoft 365 F1, F3, and Business Premium, will now be offered with a lower-priced 'no Teams' option. This provides organisations with more flexibility in choosing the subscription plan that best aligns with their needs and budget.

For further details and to stay up-to-date with announcements, visit Microsoft's blog. And a reminder that all pricing information provided in the announcement is in USD.

Our recommendation

In light of these changes, it's essential for organisations to evaluate their current and future needs regarding collaboration tools like Teams. While the removal of Teams features from certain license subscriptions may initially seem like a setback, it also presents an opportunity to reassess your requirements and explore alternative solutions if necessary.

At Theta, we're committed to helping you navigate these changes smoothly and ensuring that your organisation continues to thrive in the digital workspace. If you have any questions or require assistance in selecting the right subscription plan for your business, don't hesitate to reach out to us so we can find the best solution to support your goals and objectives.

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Our licensing specialists can help