What UCaaS platform should you choose if your organization runs Microsoft 365?

If your organization already works in Microsoft Teams, Teams Phone is the first option to price, because it runs in the Microsoft 365 tenant you already manage. Teams access, the Teams Phone entitlement, carrier service and Copilot for calls are separate licensing layers, though.

Test each team's routing, dialing and administration needs against Teams Phone and its certified contact center integrations before deciding whether every user belongs on it. A second phone platform suits a group whose tested needs Teams Phone doesn't meet, and it brings its own accounts, admin and pricing.

We reviewed Microsoft's licensing FAQ, Teams documentation and US price list, along with RingCentral's and Cisco's Teams integration pages, on October 1, 2026. Prices and SKU rules change, and negotiated agreements differ from list terms, so check each point against your own contract.

Which Microsoft 365 licenses include Teams Phone?

Since November 1, 2025, Microsoft has again sold enterprise suites with Teams to new and existing customers worldwide, and cheaper no-Teams versions remain on sale. The licensing FAQ excludes consumer, academic, US government and nonprofit SKUs from that change and lists these Teams Phone routes.

Microsoft's Teams Phone pricing page listed Teams Phone Standard at $10 per user per month, paid yearly, on October 1, 2026, plus a separate Teams license. The Teams service description lists internet calling between Teams users as a Teams feature, so the phone entitlement matters for people who make or receive calls on the phone network.

How do Calling Plans, Operator Connect and Direct Routing compare?

Every row in that table still needs carrier service, because Microsoft's PSTN connectivity overview, updated August 6, 2026, requires a PSTN connection alongside the Teams Phone license. It lists four ways to supply that connection, and one tenant can mix them across users and locations.

Microsoft's pricing page also listed Teams Phone with Calling Plan at $17 per user per month, paid yearly, for US customers, with 3,000 outbound domestic minutes per user. Microsoft's Calling Plan guide pools those minutes across users in the same country on the same plan. Against Teams Phone Standard on the same annual billing, the bundle costs $7 a month more and includes US communication taxes and fees, so compare it with a carrier's all-in quote, including support and any SBC costs. E5 users with Teams access need only carrier service, such as a separately bought Calling Plan, so that $7 isn't their price.

Calling Plans are sold only in a defined list of countries, and the Calling Plan guide points buyers in other countries to the remaining options. Operator Connect needs a certified operator in each country you deploy, which Microsoft's Operator Connect planning guide tells buyers to confirm first. Direct Routing works with any carrier through a Microsoft-certified SBC, and Microsoft positions it for existing carrier contracts, third-party PBXs and analog devices.

In GCC High and DoD tenants, Teams voice and audio conferencing require Direct Routing, according to the Teams service description updated July 8, 2026. The Direct Routing guide lists dedicated SIP connection points for each of those clouds, so buyers there compare carriers and SBC operators that support them.

What does Copilot add to Teams Phone calls, and which license pays for it?

Microsoft's admin guide for Copilot in Teams calls, updated October 1, 2026, requires a Microsoft Copilot license for each user who wants Copilot in a 1:1 call. For calls over the phone network, it also lists Teams Phone licensing and a calling plan. Copilot is a paid add-on for E3 and E5, while Microsoft 365 E7, generally available since May 1, 2026, includes it with everything in E5. Intelligent recap, which produces AI notes and suggested tasks after PSTN calls, works with either a Teams Premium or a Copilot license.

When an admin turns Copilot on and call transcription off, licensed users can prompt Copilot while the call runs, but neither its output nor a transcript is kept afterward. Microsoft also blocks Copilot from end-to-end encrypted calls.

Microsoft's guide covers 1:1 Teams calls and PSTN calls governed by Teams calling policies, so for calls placed in an embedded third-party app, ask that vendor which AI features apply. Cisco documents in-call summaries from its own AI Assistant in Cisco Call for Microsoft Teams, and RingCentral's Teams page lists call summaries among its features.

What does Teams Phone share with the rest of Microsoft 365?

Teams Phone users are the same Microsoft 365 accounts, synced with Microsoft Entra ID, as Microsoft's Teams Phone licensing guide explains.

A recorded 1:1 or group Teams call is saved to the OneDrive of the person who selected Record, and channel meeting recordings go to the channel's SharePoint library. Retention policies set on those OneDrive and SharePoint locations can cover the recordings, and Microsoft's Purview service description includes such policies in E3, E5 and Business Premium. Applying retention labels automatically based on content or properties needs E5-level or Purview add-on licensing, so confirm which policies and licenses your tenant has before relying on them for call recordings.

Cisco's Teams integration asks users to sign in to the Webex App before Cisco Call works in Teams. Ask any embedded-app vendor where its recordings, transcripts and voicemail are stored and which of your retention and eDiscovery policies reach them.

How do contact centers connect to Teams Phone?

Teams Phone covers call queues and auto attendants through resource accounts, each needing a Teams Phone Resource Account license, according to the Teams service description. Microsoft sells the Queues app, which adds queue management for those call queues and auto attendants, only with Teams Premium on top of Teams and Teams Phone.

For larger contact centers, Microsoft certifies third-party products under three integration models. In the Unify model, the provider builds its application on Azure Communication Services and Teams calling infrastructure. In the Extend model, Teams Phone handles the calls while the provider serves as a carrier next to Microsoft 365 and agents work in a Teams app. The Connect model links the provider's own platform to Teams through Direct Routing and certified SBCs.

The model determines which platform carries the customer call and whose tools manage routing and recording, so ask a contact center vendor which model it's certified for before you compare features.

When should part of the workforce use a different phone platform?

Third-party phone vendors either act as the carrier behind Teams Phone or run their own phone system inside Teams. RingCentral offers both, listing Direct Routing and an early-access Operator Connect service for Teams Phone alongside an embedded app that brings its own calling, analytics, SMS and fax into Teams. Cisco Call takes the second route, running calls on Webex Calling or Cisco's own call control from inside Teams. With the carrier route you still license Teams Phone, and with the app route you pay for a second phone system.

Take a hypothetical company with 4,000 users on Microsoft 365 E3 that already includes Teams, where testing shows a 200-seat outbound sales floor needs dialing features Teams Phone doesn't provide. At October 2026 US list prices billed annually, Teams Phone Standard licenses for all 4,000 cost $480,000 a year, against $456,000 if the sales floor moves to a third-party app inside Teams. Both figures cover phone licenses only, before carrier charges and the 200 third-party seats.

The $24,000 annual difference is spend the company avoids only at a new purchase or an eligible renewal, because annual licenses and carrier contracts can carry minimum terms. If those 200 users held E5 or E7, the phone entitlement would stay in the suite price, so the move could remove at most their carrier charges while adding the third-party seats.