How Microsoft is Nudging Customers to Use the Teams Phone System

Audio Conferencing and Revamped Teams Phone Offering

Last July, Microsoft said that Teams had reached 250 million monthly active users. That’s a lot of people, all of whom Microsoft would like to have using Teams as much as possible. To nudge more customers into using Teams as a phone system, Microsoft is making two changes.

Update January 26, 2022: The new Microsoft number is 270 million Teams monthly active users.

First, they’re making audio conferencing (“unlimited dial-in capabilities for Microsoft Teams meetings”) available to all Microsoft 365 and Office 365 plans which include Teams starting on March 1, 2022. In other words, anyone will be able to dial into a Teams online meeting using a number managed by Microsoft. This capability already existed in the Office 365 E5 and Microsoft 365 E5 plans and is offered to help ease the pain of the price increases coming for many Office 365 and Microsoft 365 plans due at the same time.

Second, Microsoft is replacing its Microsoft 365 Business Voice (SMB) and Teams Calling Essential (enterprise) products with a new Teams Phone with Calling Plan offering. The new product is available in 33 markets starting January 1, 2022, and can be added to any Office 365 or Microsoft 365 plan which includes Teams. Microsoft will phase out the old products on March 1, 2022. However, customers with existing subscriptions can continue to use them until the subscriptions expire.

What’s in Teams Phone with Calling Plan

Although Teams Phone with Calling Plan is a slightly clunky name, it accurately captures the two major components delivered by the product:

• A cloud-based phone system to allow Teams users to make, receive, and transfer calls to landlines and mobile phones connected by the public switched telephone network (PSTN).
• A calling plan allowing up to 3,000 domestic minutes per month (U.S. and Canada) and 1,200 domestic minutes (other markets). In other words, a Teams user in the U.K. can chat to PSTN phones for 20 hours without incurring any charges.

A FAQ included in the Teams Phone with Calling Plan announcement says that the new product costs $15/user/month in the U.S., Canada, and U.K. and $20/user/month elsewhere. The differences in cost and number of minutes for the domestic calling plan are likely due to the level of competition and telephony charges in different markets. See this page for more details on the calling plan markets.

The Teams Phone SKU continues as a separate offering ($8 in the U.S.) to allow customers to choose to use calling plans from other providers.

The Microsoft Opportunity

Convincing customers to use Teams Phone with Calling Plan to replace other cloud-based phone systems and older-style PBXs is a big thing for Microsoft. Apart from reinforcing the commitment customers have to the Microsoft 365 ecosystem, Microsoft creates an opportunity to sell customers additional cost-plus features such as:

• International calling plans.
• Use of calling minutes after exceeding the threshold for a monthly plan.
• Communication credits to cover the use of features such as toll-free numbers in audio conferencing meetings, auto attendants, and call queues.
• Selling Teams hardware like the Surface Hub. Oddly, Microsoft’s listing of Teams headphones doesn’t include the excellent Surface headphones (which I use).

Planning for Teams Phone

Of course, embracing the Teams phone system is only one step along the journey. Other considerations include what devices and headsets to use, allocation of phone numbers and porting from previous systems, voicemail, meeting room systems, emergency calling, and network connectivity (internet-based telephony can create its own network demands). Given that Teams Phone has been around for several years, there’s nothing odd or startling in the planning requirements, but it needs to happen.

Teams Phone doesn’t support FAX or SMS. FAX is still used extensively in some industries and the need is served by third-party add-ons. Microsoft says that they’re “aware of the need” for SMS, which might indicate that Microsoft might include this capability in Teams in the future. For now, several apps are available in the Teams app store to allow SMS to be sent and received from a Teams client (Figure 1). Not all these apps might be available in all markets.

Good Change

Simplification is seldom bad. It makes sense for Microsoft to offer a single Teams Phone with Calling Plan product to both SMB and enterprise customers. Increased customer interest in Teams-based telephony will drive engineering investment from both Microsoft and ISVs, and that’s also goodness. Teams continues rolling to dominance.

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