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Microsoft Releases Teams Essentials for Small Businesses Collaboration

Microsoft's Teams Essentials, a new collaboration product for small businesses, is now available, according to the company

Teams Essentials is a so-called "standalone" product, meaning that it isn't sold with a Microsoft 365 subscription, which has been the main way to get access to Teams. It's priced at $4 per user per month, and sold either directly by Microsoft or by its Cloud Solution Provider partners at that same price. Teams Essentials offers "commercial-grade" chat, file collaboration and online meetings capabilities.

When Teams Essentials is bought directly from Microsoft, there is no expectation for needing IT support to get the service going, but subscribers must join to the service using Microsoft accounts. A "mobile chat dashboard" feature was described in the announcement as being "available for customers purchasing directly from Microsoft," suggesting there could be some slight product differences, or release timing differences, based on the purchasing method.

When sold by Microsoft's partners, the product is called "Microsoft Teams Essentials (AAD Identity)" and the Azure Active Directory service is used to join the account. This partner-serviced product adds support for organizations wanting to link their existing e-mail and calendars services with Teams. Doing so is no small feat. The multistep process is described by Microsoft 365 Director Jeremy Chapman in this announcement and video. It's also outlined in this Microsoft document.

Small Business Market
The small business target market for Teams Essentials isn't precisely described. Microsoft appears to sell the service for "up to 50 users" per an FAQ at the end of this Teams product comparison page.  

However, a product guide (PDF download) offered by Microsoft partner Rhipe described Teams Essentials as being optimal for under 25 users, but available for one to 300 users.

When, asked about it, a Microsoft spokesperson just reiterated those limits for Teams Essentials subscriptions:

A single subscription allows you to pay on behalf of up to 50 users. Subscriptions purchased through channel partners can add up to 300 users.

Partner Support
Partners ready to service the Microsoft Teams Essentials (AAD Identity) product include "ALSOCrayonIngramPax8RhipeTD SynnexTelefonica (ES)Deutsche TelekomVodafone (IT), [and] Wortmann AG," per the announcement.

Microsoft sees Teams Essentials as an entry-level product for organizations that partners can manage using Microsoft 365 Lighthouse and Project "Orland." Partners get "the ability to easily transition [customers] into more advanced Microsoft 365 for business suites as customer needs grow," according to a product description by Dan Truax, general manager of Microsoft's Global Partner Solutions."

Teams Essentials works with Microsoft's PBX replacement solutions (namely Teams Phone System, Direct Routing and Operator Connect) or first-party calling plans, Truax explained. It's also possible for Microsoft's independent software vendors to integrate their solutions with Teams Essentials.

Another Teams Essentials upsell for partners is Microsoft Defender for Business, a new antivirus and endpoint detection and response product for small- and medium-size organizations that was announced during last month's Ignite event.

Teams Essentials vs. Other Teams Products
Microsoft compares its Teams products in this "Get Started" document, showing features of the Teams Free, Teams Essentials, Teams Essentials (AAD Identity) and Microsoft 365 Business Basic products.

Teams Essentials users can have online meetings lasting 30 hours, instead of 1 hour with the Teams Free version. A meeting can consist of up to 300 participants with Teams Essentials vs. 100 participants with Teams Free. There's also a 10GB per user file and document cloud storage allocation with Teams Essentials, while Teams Free users just get 5GB of storage.

Other than those differences listed above, the Teams Essentials and Teams Free product appear to have the same capabilities, including Excel, PowerPoint and Word Web app and mobile app support. Both products will be getting the ability to sync with Google Calendar, which is said to be "coming soon."

The Teams Essentials storage limit involves the use of the OneDrive cloud storage service, and additional storage can be purchased, the spokesperson clarified:

Any use of OneDrive within Teams Essentials counts against the 10GB limit. Users can look up how much storage they are using (and there is an option to get more storage).

Microsoft's comparison table omits one important detail, which is that Microsoft is planning to increase prices after March 1, 2022. At that time, Teams Essentials will cost $4 per user per month, while Microsoft 365 Business Basic will increase from $5 per user per month to $6 per user per month. Microsoft will also hike its Microsoft 365 Business Premium plan at that time from $20 per user per month to $22 per user per month.

Those pricing changes can be seen in overview form via this chart from Microsoft partner TechData. Microsoft had announced these coming Office 365 and Microsoft 365 price hikes back in August.

Organizations can't mix Teams Free with Teams Essentials. Moreover, upgrades from Teams Free to Teams Essentials can't revert back to the free version, Microsoft's FAQ explained.

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