How much does Microsoft Teams Cost for Small Businesses?

How much does Microsoft Teams cist for small businesses?

If you’re exploring which modern meeting and collaboration tool might be best for your business, no doubt there’s a few names that keep cropping up, the big ones being Zoom, Slack, Skype for Business and Microsoft Teams. All of them claim to improve team productivity by making communication and collaboration simpler and more effective. In this article, we’ll give you the lowdown on Microsoft Teams and what you can expect to pay to use the service.


One of the questions we often get asked is “How much does Microsoft Teams cost?” 

On the face of it, the answer is simple and something you can find out in a jiffy by visiting Microsoft’s pricing page (spoiler alert – Teams is FREE!), however there are many other variables that might affect the total true cost.  We will try to explain with some general guidelines.  Before we dive headfirst into the complexities of cost, there’s some important questions that need answering first.


What is Microsoft Teams?

Teams could be described as a “digital hub” that features chat tools, document collaboration, document storage, voice and video calling capabilities. Microsoft has called it a “digital translation of an open office space” which sums it up quite nicely! It competes with Slack on some features, and it is like Skype for Business in others.  The list of features is increasing and improving year-on-year.  Currently some of the features include:

  • Chat tools
  • Video conferencing
  • Audio conferencing
  • Telephony system
  • Document sharing
  • Document collaboration

It’s quite difficult to describe exactly what Teams is capable of in just a few words, so if you’d like to find out a bit more here’s a short video from Microsoft.


Is Microsoft Teams right for your business?

If your business faces any challenges around remote working, collaboration, email-overload, effective internal and external communication, then Microsoft Teams might be just what you’re looking for.

Microsoft Teams can help your staff overcome communication gaps, easily work collaboratively and (in a time where remote and home working is becoming the norm) allow everyone to feel more connected to the workplace and their colleagues no matter where they’re working from, while still maintaining high security standards and effective control and compliance of your business documents.


Microsoft Teams or Zoom?

There is no right or wrong answer here.  If you just need to chat or video call you could use either.  At the time of writing Zoom only allows scheduled meetings of up to 40 minutes in their free version.  There is no time limit on Teams meetings, even in the free version.

If you really want to take your business to the next level by collaborating on all the business documents you are used to, then Microsoft 365 with integrated Microsoft Teams could be your best option.


Microsoft 365 with Teams – The Costs

Microsoft and many other IT providers have moved to a subscription model for their cloud services.  They call it Software-as-a-Service (SaaS).  What it means is, for a low monthly cost you get access to their software, and you will benefit from the continued improvements and updates to the service.


At the time of writing, the costs for some of the different versions are:

Microsoft Teams
Microsoft 365 Business Basic
Microsoft 365 Business Standard
Microsoft 365 Business Premium Edition
per user
per month
per user
per month
per user
per month
Yes! If you are just looking to chat and video call (think of it as an enhanced version of Skype) it might be all you need!
This is for a limited selection of features, but does include Teams and access to the web versions of Outlook, Word, Excel etc.  This might suit you if you are just starting out and your business demands are not great. 
This is very popular with many of our business clients.  It includes the desktop versions of Microsoft Office, such as Outlook, Word, Excel etc.
This has everything you get in the Business Standard product plus additional storage and enhanced security features.  It is popular with clients that would like the extra security either from a best-practise standpoint or for compliance if they are in a regulated industry sector such as Legal or Finance.

And There’s More

The above are just the small business options. You may be a small business that requires enterprise features, in which case there are Microsoft 365 Enterprise plans available which have features over and above those included in the Business Premium plans. Prices increase up to £48.10 per user per month, excluding any add-ons.

As you can see, pricing varies considerable and can be a bit of a minefield.  Don’t worry, this is where we can help advise on what might be best for your business.


Is it Worth Saving Your Money and Just Sticking with your Old Copy of Microsoft Office?

If you only want to use the desktop applications of Word, Excel, Outlook etc., then a stand-alone (and perhaps) older version of Microsoft Office may be fine.  However, with Microsoft 365 you not only get the desktop applications you are used to (Word, Excel, Outlook, PowerPoint etc.) but also continual updates and improvements of the software, along with a full email platform and computer architecture that provides the service. 

In the “olden days” you might have had a server that “served” your emails and files, usually from a dusty corner of your office or in a cupboard that only the “IT guy” would dare venture into. It will have needed to be maintained and kept running for your business to be able to log into the computers and access emails and files.

With a cloud service, you are paying for Microsoft (or Google or any other cloud provider) to manage their servers to provide their services to you (OK, their servers aren’t in a dusty cupboard, in fact they are in high-tech secure datacentres, some could even be under the sea!). This means that the service should ALWAYS be available for you to use without having to manage any of your own servers (technically they have an uptime of 99.99%).

Rows of computer server racks

Not a dusty cupboard! Rows of server racks in a data centre


Are There Other Costs to Consider?

The costs listed above are the Microsoft service costs. Depending on your situation, you will likely have other setup or migration costs.

Setting up the service from scratch could take a few hours, and cost in the region of £200 – £400 for a small 5 user setup.  This would involve setting up the system with your own domain name, creating user accounts, turning on the appropriate security features, getting users logged in and showing them some of the basic features etc.

For a larger company or a setup that involves migration of existing services, more planning would be required to ensure success. This would typically involve a workshop, planning and design time, followed by a planned migration. All this could run to 5 -10 days depending on the size of business and the amount of data that would need to be migrated, costing £5,000 and upwards.

Compare this to the cost of renewing a basic server, with typical hardware costs around £4,000 and the time to set it up and migrate services around £2000, the one-off costs of replacing an existing  server with new hardware are in a similar ballpark to a migration to a cloud service, without the added benefits a cloud service brings.


Next Steps

Whether you’re ready to implement Microsoft Teams, or you need more information to understand if Microsoft Teams is the best solution for your business, get in touch with us and we’ll be happy to help.