A New Era for Microsoft 365: Teams Shift and What It Means for CSP Partners
Effective Date: April 1, 2024
As the digital landscape continuously evolves, so does the way we package and offer cloud solutions. In a significant update from Microsoft, the Microsoft 365 (M365) suites are undergoing a pivotal shift, particularly regarding Microsoft Teams.
This change, initially propelled by regulatory adjustments in the European Economic Area (EEA), is now taking a global stride, affecting Cloud Solution Provider (CSP) Direct Bill Partners, CSP Indirect Resellers, CSP Indirect Providers, and Licensing Solution Providers alike.
Teams Exclusion for New M365 Customers
The most notable adjustment is that Microsoft Teams will no longer be included in the standard M365 suites for new customers.
This change mandates an additional subscription specifically for Teams, marking a significant shift in how businesses will approach their digital collaboration and communication tools.
Key Points:
- Introduction of commercial Microsoft 365 and Office 365 suites excluding Teams for regions outside the EEA and Switzerland.
- Launch of a standalone Teams offering for enterprise customers.
- This global standardization aims to reduce confusion, making it easier for customers worldwide to understand their licensing options.
Impact:
- Customers will need to adapt to the new licensing structure, potentially affecting their collaboration tool choices and budget allocations.
Continuity for Existing M365 Subscribers
For those already within the M365 ecosystem, this change brings a sigh of relief. Existing M365 customers can renew their current licenses without the need for a separate Teams subscription, ensuring a smooth continuation of services.
Key Points:
- Discontinuation of Office 365 E1, E3, E5, Microsoft 365 E3, and E5 suites with Teams for new subscribers globally.
- Current subscribers can continue, renew, or upgrade their plans as usual or switch to the new lineup at contract renewal.
- New customers will need to navigate the updated offerings to select the best fit for their needs.
Adjusted Pricing Strategy
The restructuring of M365 suites introduces a cost reduction, approximately $1.50 less per user per month. However, integrating Teams into the suite will entail an additional cost of about $5.25 per user per month, prompting organizations to reassess their digital communication needs versus budget constraints.
| Suite Type | Old Pricing (with Teams) | New Pricing (without Teams) | Standalone Teams Pricing |
|---|---|---|---|
| Office 365 E1 | - | $7.75 | $5.25 |
| Office 365 E3 | - | $20.75 | $5.25 |
| Office 365 E5 | - | $35.75 | $5.25 |
| Microsoft 365 E3 | - | $33.75 | $5.25 |
| Microsoft 365 E5 | - | $54.75 | $5.25 |
| Microsoft 365 F1 | $2.25 | $1.75 | $5.25 |
| Office 365 F3 | $4.00 | $3.50 | $5.25 |
| Microsoft 365 F3 | $8.00 | $7.50 | $5.25 |
| Microsoft 365 Business Basic | $6.00 | $4.75 | $5.25 |
| Microsoft 365 Business Standard | $12.50 | $10.25 | $5.25 |
| Microsoft 365 Business Premium | $22.00 | $19.75 | $5.25 |
Key points:
- Reduced pricing for new suites without Teams, offering cost savings for customers not requiring Teams.
- Coexistence of current and new suites, providing choices between versions with and without Teams.
- Pricing adjustments and the introduction of new suites without Teams reflect Microsoft's strategy to accommodate a wider range of customer budgets and needs.
Understanding the New Product Lineup
The revised product lineup will introduce M365 suites sans Teams, adhering to the existing naming convention but with the notable addition of "(no Teams)." This change affects a wide range of offerings:
- Microsoft 365 E3/E5, Office 365 E1/E3/E5
- Microsoft 365 Business Premium, Business Standard, Business Basic
- Microsoft 365 F1/F3, Office 365 F3
Furthermore, a new standalone Microsoft Teams Enterprise offering will be launched, catering to those who seek the robust collaborative capabilities of Teams independently of other M365 services.
Introduction of Standalone Teams Offering
Microsoft's strategic update introduces a standalone Microsoft Teams Enterprise option at $5.25, reflecting its importance in modern collaboration. This change allows businesses to tailor their software stacks more precisely, catering to demands for flexibility and organizational specificity.
Key Points:
- New standalone Microsoft Teams Enterprise pricing at $5.25, subject to regional variations.
- This reflects Microsoft's recognition of Teams as a central collaboration tool, now offered independently to meet the demand for flexibility.
- Allows businesses to tailor their software stack more precisely, potentially increasing the adoption of Teams in enterprises.
Next Steps for Partners
To fully grasp the implications of these changes, partners are encouraged to dive deep into the available resources. Access the Partner FAQ, guidance deck, and licensing blog through the provided link for comprehensive insights.
For queries beyond the FAQ or those requiring clarification on pricing, availability, and migrations, initiating a Support request in Partner Center is advised.
This transition heralds a new phase for CSP partners and clients. As Microsoft 365 continues to evolve, staying informed and proactive will be key to navigating these changes successfully.