How much does Teams Phone cost?

These are US prices in US dollars from Microsoft's Teams Phone page. Microsoft sets calling plan prices and minute allowances by country, so a user licensed elsewhere needs that country's price list. All four are paid yearly and quoted as a monthly figure, which makes a $10 license a $120 charge per user for the year.

Teams Phone Standard is the phone system alone. It provides voicemail, call transfer, auto attendants and call queues, with no route to an outside number. The other three add Microsoft as the phone company, and they differ in how calling is billed. The pay-as-you-go version charges for each outbound minute. The $17 version includes 3,000 outbound domestic minutes a month. The $34 version includes 3,000 domestic minutes or 600 international minutes a month, whichever is reached first, so it is one allowance with two ways to use it up.

The domestic bundle costs $7 more per user per month than Teams Phone Standard and includes Microsoft calling service. The same job can go to another carrier at a different price, which is why Teams Phone and a Calling Plan are separate things.

A full Teams Phone cost has four parts: the Teams license underneath, the right to use the phone system, the calling service, and taxes. Microsoft's list prices cover the middle two. Teams Phone Standard covers the phone system, and the three bundles cover the phone system and the calling service.

The base license comes first. Teams Phone Standard requires a prerequisite license, and Microsoft's Teams Phone licensing page lists Microsoft 365 Business Basic, Business Standard, Business Premium and E3, Office 365 E1 and E3, and Teams Enterprise among them. A company already running Teams on one of those plans pays nothing new here. A company starting from nothing pays for that plan before any phone license.

The phone system itself is the $10, and some users already have it. Any Microsoft 365 E5 license includes the phone system, so those users don't need Teams Phone Standard as well. Look at what each user is assigned before adding $10 a head, because the Teams Phone license you need depends on what you hold today. E5 supplies the phone system but not the calling service, so an E5 user still needs one.

The calling service is the connection to the public phone network. Microsoft sells it inside the three bundles above. A carrier can supply it instead, through Operator Connect, Teams Phone Mobile or Direct Routing. In that case Microsoft requires no further license, because the calling costs come from the operator you chose. That is the reason you don't need a Calling Plan with Teams Phone when a carrier provides the service.

Tax is the last part, and Microsoft treats the two halves of a bundle differently. Its pricing footnotes say the calling-service portion includes the required US communication taxes and fees. The phone-system portion does not include applicable sales tax. A $17 bundle is therefore not a fully tax-inclusive price, and a $10 Teams Phone Standard license is a pre-tax price.

Atlantech Online, a carrier in Microsoft's Operator Connect program, publishes two starting rates and quotes the price for each organization. Its Operator Connect page lists a flat rate "as low as $3 per user/month" with unlimited calling in the US, number porting, a management tool called Call Manager and 24/7 support. The $3 is a floor, and the page doesn't say how taxes and fees are treated.

Atlantech describes a second model for large organizations as well. It pairs a small per-user charge with a shared pool of call capacity, on the reasoning that only a fraction of users are on a call at any moment. No rate is published for that model.

The same carrier's Teams Calling page lists a service "starting at $10 per user per month." Atlantech says that service includes Direct Routing, unlimited local and long-distance calling, call queues, an enterprise dial plan and setup. This $10 is the carrier's charge for its service and has nothing to do with Microsoft's $10 license. The $3 and $10 figures describe different services, so they are not two prices for the same thing.

Both are prices for the carrier's part. Microsoft's licensing is a separate requirement, which a user's existing plan may already meet.

Suppose a 25-person firm already has Teams on a qualifying Microsoft 365 plan. None of its users has the phone system yet. The firm chooses Operator Connect, and its carrier quote comes in at Atlantech's published $3 floor.

Each user then costs $10 to Microsoft and $3 to the carrier, or $13 a month. For 25 users that is $325 a month. Microsoft's $250 share is billed yearly, $3,000 for the year. The carrier's $75 a month follows the billing terms in the quote. The $325 leaves out sales tax on the Microsoft license and any amounts the carrier's quote lists beyond its per-user rate.

Put the same 25 users on Microsoft's domestic bundle and the list price is $17 each, or $425 a month and $5,100 a year. The $100 monthly gap is real arithmetic, but the two totals are not like for like. The Microsoft figure already includes communication taxes on its calling portion and carries a 3,000-minute monthly allowance per user. The carrier figure is a published floor for unlimited US calling. A fair comparison needs the carrier's actual quote and both totals with tax.

If those 25 users held Microsoft 365 E5 licenses that include Teams, the $10 line would disappear and the carrier's charge would be the only new cost. If the firm had no Microsoft 365 plan at all, the base license would be added to every figure above.

A per-user list price is a starting point, and call volume is the first thing that moves it. On the pay-as-you-go license every outbound minute is charged. On the calling plans, Microsoft's Calling Plans page says users in the same country on the same plan share one pool of minutes, and calls beyond the pool are billed per minute. Twenty-five users on the domestic plan share 75,000 minutes a month. A few heavy callers don't trigger overage as long as the group stays under that total.

A desk phone is optional, because Teams Phone runs in the Teams app on a computer or mobile phone, but it is a purchase when a team wants one. Moving existing numbers and setting up the system take work too. Atlantech's Operator Connect page lists number porting as included in its flat rate, and its Teams Calling page lists setup and deployment as part of that service.

The way calls reach Teams matters too. Direct Routing passes calls through a session border controller, a device that sits between the carrier's network and Teams. Someone has to buy it and run it, or a provider has to run it for you. That cost belongs in the comparison when you choose how Teams Phone reaches the phone network.