Realigning Global Licensing for Microsoft 365
Monday 29th April 2024
Microsoft has announced changes to the licensing of Microsoft 365 and Teams, effective from 1st April 2024. Here are the key points:
New Lineup: Microsoft is introducing a new lineup of commercial Microsoft 365 and Office 365 suites that do not include Teams for regions outside the European Economic Area (EEA) and Switzerland.
- Standalone Teams Offering: There will be a new standalone Teams offering for Enterprise customers in those regions.
- Existing Subscriptions: Customers with existing subscriptions that include Microsoft Teams can continue using plans they have already chosen.
- Changes for New Subscribers: Net new subscribers to Office/Microsoft 365 Enterprise suites who wish to provide their end users with Teams will need to purchase two SKUs: one Microsoft 365 (no Teams) or Office 365 (no Teams) suite and Microsoft Teams Enterprise.
- Pricing: The pricing for the new suites without Teams and the standalone Teams offering has been outlined, with the standalone Teams Enterprise priced at $5.25. Depending on the subscription purchased, customers may experience a moderate to significant increase in costs, ranging from 5% to 44%, when purchasing subscriptions separately.
| SKU | Before | After (Without Teams) | After (with Teams) | Increase ($) | Increase (%) |
| Office 365 E1 | $9.00 | $7.75 | $13.00 | $4.00 | 44% |
| Office 365 E3 | $23.00 | $20.75 | $26.00 | $3.00 | 13% |
| Office 365 E5 | $38.00 | $35.75 | $41.00 | $3.00 | 8% |
| Microsoft 365 E3 | $36.00 | $33.75 | $39.00 | $3.00 | 8% |
| Microsoft 365 E5 | $57.00 | $54.75 | $60.00 | $3.00 | 5% |
These changes aim to provide globally consistent licensing, which helps ensure clarity for customers and streamlines decision-making and negotiations. For more detailed information, you can visit the official Microsoft licensing news page.
It's important to note that these changes primarily affect customers on Enterprise suites, as Frontline and Business suites will continue to be available for purchase with Teams included.
How will this change affect CSP customers?
Under CSP existing ‘With Teams’ you can:
• Use existing licenses for suites with Teams.
• Renew existing licenses for suites with Teams.
• Increase the quantity of your existing subscription for suites with Teams.
• Upgrade your existing suites with Teams to other suites with Teams.
• Add net new licenses to any suite with Teams that was previously available to you.
• Switch to different suites with Teams at anniversary/renewal in accordance with the terms of your contract
In short, existing ‘with teams’ in CSP licensing, will not be affected at all (unless you allow your services to expire, or try and change billing terms).
What do I do next?
Understanding utilisation of Teams has never been more important. Our proprietary toolset, Quantum 365 coupled with our licensing and commercial expertise will quickly help you ascertain how you can restructure your 365 commitments to minimise the impact of this change. We welcome the opportunity to guide you through this challenging Microsoft change to reach the right outcome based on factual evidence of usage.
Please reach out to discuss our Quantum and Commercial advisory services, we can work together to ensure you are making full use of your Microsoft services. Please email us on [email protected] to get in touch.
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