What Is the Price of Microsoft Teams? 2025 Pricing Guide

Understanding How Teams Is Priced

Microsoft Teams is not sold as a standalone paid product for most business users. Instead, it is bundled into Microsoft 365 subscriptions — which means the price you pay for Teams also includes Exchange email, OneDrive storage, SharePoint, and in higher tiers, the full Office application suite.

This bundling makes direct price comparisons with competing platforms (Slack, Zoom, Google Workspace) more nuanced, because Teams comes with a broad range of tools rather than just the messaging and meetings functionality. For businesses that already need email, file storage and Office applications, the additional cost of Teams within a Microsoft 365 plan is often marginal.

Teams Free

Microsoft offers a free Teams plan for individuals and small teams. Free users get:

• Unlimited one-to-one calling
• Group meetings with a 60-minute limit (up to 100 participants)
• Chat with message history
• 5GB file storage per user
• Office web apps for viewing and basic editing

For professional business use, the 60-minute group meeting cap is limiting. The free version lacks meeting recording, transcription, scheduling integrations and the admin controls businesses need for IT governance.

Teams Essentials — Approx. £3.40/user/month

Teams Essentials is Microsoft's entry-level paid plan for Teams-only use. It provides:

• Meetings up to 30 hours per session
• Up to 300 participants per meeting
• 10GB cloud storage per user
• Standard support

It does not include Exchange email, desktop Office apps, or recording. For most businesses, jumping to Business Basic is more cost-effective given the additional services included.

Microsoft 365 Business Basic — £4.60/user/month

This is the most popular entry point for businesses adopting Teams professionally. Business Basic includes:

• Microsoft Teams — full meeting features, recording, transcription, breakout rooms
• Exchange Online — 50GB mailbox
• 1TB OneDrive per user
• SharePoint
• Office web apps (browser-based Word, Excel, PowerPoint)

There are no desktop Office installations at this level. If your staff work primarily on web-based tasks or use mobile devices, Basic is often sufficient. For traditional office workers who need Word, Excel and Outlook installed locally, Business Standard is a better fit.

Microsoft 365 Business Standard — £9.40/user/month

Business Standard adds installed Office applications on up to 5 devices per user, plus:

• Desktop installations of Word, Excel, PowerPoint, Outlook, OneNote, Access
• Teams Webinars (for hosting external events with registration)
• Microsoft Bookings, Forms, Planner

This is the most commonly recommended plan for UK SMEs. The combination of full Office apps, business email, Teams and cloud storage covers the core needs of most office-based teams.

Microsoft 365 Business Premium — £17.60/user/month

Business Premium includes everything in Standard plus enterprise-grade security:

• Microsoft Defender for Business
• Azure Active Directory Premium P1
• Microsoft Intune (mobile device management)
• Microsoft Purview Information Protection
• Azure Information Protection P1

For businesses in regulated sectors, those that have completed or are working toward Cyber Essentials Plus, or organisations that handle confidential client data, Premium is the appropriate plan. The security toolset included would cost significantly more if purchased separately.

Microsoft 365 E3 — £30.20/user/month

E3 is the entry-level enterprise plan, designed for organisations with 300+ users or those needing advanced compliance and identity management. It includes unlimited licence installs, advanced eDiscovery, and Azure AD Premium P1.

Microsoft 365 E5 — £47.80/user/month

E5 is Microsoft's most comprehensive plan, including advanced threat analytics, Microsoft Defender for Endpoint P2, Microsoft Purview advanced compliance, and Power BI Pro. It also includes Teams Audio Conferencing and Teams Phone System, making it attractive for large organisations looking to consolidate voice and collaboration.

Teams Phone: Additional Calling Costs

None of the above plans include outbound calling to standard phone numbers (PSTN calling) by default. Teams Phone functionality requires either:

• Microsoft Calling Plan — approximately £8-12/user/month for domestic UK calling
• Operator Connect — connect an existing phone provider to Teams
• Direct Routing — connect Teams to an SIP trunk via a Session Border Controller (SBC)

For businesses consolidating their phone system onto Teams, AMVIA provides Teams Phone deployment including number porting, calling plan management, and SBC configuration.

Annual vs Monthly Commitment

All prices quoted are based on an annual subscription commitment. Month-to-month billing is available at approximately 20% higher cost per user. For established businesses, annual commitment provides better value. For new hires or temporary contractors, monthly licences allow flexibility.