As of October 2023, Microsoft is removing Teams from their Enterprise suites for the EEA and Switzerland¹. The affected subscription plans, such as Office 365 E1/E3/E5 and Microsoft 365 E3/E5, will no longer include the popular collaboration service – it will be available for purchase only as a separate product.
The split is a result of the European Union’s continuous efforts to have a fair market with fewer monopolies. It’s been deemed that Microsoft is getting an unfair edge over their competitors by bundling Teams with its business-oriented subscription plans² – this meant that other solutions were automatically excluded, even though they could provide equally suitable services for communication and collaboration.
As a result of the current change, organisations with more than 300 employees (the common Enterprise suite users) who have been relying on the popular tool will have to rethink their IT infrastructure, workflows, and budget. For Office 365 E1 and E3 subscribers, it won’t even be the first time this year, as Microsoft increased these plans’ prices of their cloud services in April.
What are your options now?
Firstly, if your company is already subscribed to Microsoft 365 Enterprise or Business services, it can continue using these cloud suites as they are, no changes required. The new rules mostly concern new subscribers.
Next is assessing whether your organisation really needs Microsoft 365 tools and features, and especially Teams (which won’t be included in the new EEA-specific plans). Our Head of Licensing Solutions Manager Mateusz Drozdowski offers expert insight on the topic:
“Business is never one-size-fits-all, and the same goes for software solutions. In large enterprises, it’s often beneficial to combine various licensing models to achieve the most cost-efficient setup. For instance, you could deploy perpetual Microsoft Office licenses along with Teams for your regular employees, and opt for the more feature-rich Office 365 E3 (also supplemented by Teams) for the management tier.
But why rely on Microsoft at all? The key is to align your software strategy with your operational needs, not with the needs of the software manufacturer. There are alternatives that provide equally robust results, yet at a much lower price.”
To give you a concrete example, let’s analyse 2 possible scenarios for a hypothetical company with 350 employees that would like to purchase a new Office 365 E3 subscription plan:
- Subscription-only solution: Microsoft Office 365 E3 EEA + Microsoft Teams EEA – likely the least optimised choice but if Microsoft 365 functionalities are absolutely crucial for the company’s processes, for example if it’s heavily dependent on Azure service, it might be the only option. However we highly recommend conducting an in-depth analysis in such cases to make sure unnecessary costs are avoided.
- Hybrid solution: Used Microsoft Office LTSC Professional Plus 2021 + Microsoft Teams EEA – if the company needs Microsoft 365 plans mainly to use standard Office programs (Word, Excel, Outlook etc) and Teams, this new change can be great for it, because most of the annual costly service can be replaced with a one-time payment for used Office LTSC Professional Plus 2021 while subscribing to Teams EEA separately.
Price comparison: A company with 350 employees over a period of 5 years
Hover over the graph for additional data.
As is immediately apparent, the hybrid solution becomes more cost-friendly after just one year and is more than 2 times cheaper by year 5.
Conclusion
Due to its prolonged and widespread presence on the software market, Microsoft has a strong leverage on companies’ software-related decisions. Additionally, the SaaS licensing model continues to concentrate even more power into the megacorporation’s hands. It is imperative for businesses to start exploring alternatives more thoroughly instead of letting habit and familiarity guide them, should they want to reduce their operational costs as well as be less reliant on Microsoft’s views on the future of software. Don’t let the sudden changes in Microsoft’s pricing and licensing structure derail your plans, IT infrastructure, operational efficiency, or budget!
¹ Microsoft’s official announcement: https://www.microsoft.com/en-us/licensing/news/Microsoft365-Teams-EEA
² The European Commission’s press release: https://ec.europa.eu/commission/presscorner/detail/en/ip_23_3991
