Microsoft aims Teams Essentials at small-biz customers

The new pricing tier from Microsoft costs $4 per user each month and offers a paid alternative to the existing free version of Teams

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Microsoft has introduced a new paid tier for its Teams collaboration software aimed at small business customers.

The new option — called Teams Essentials — offers additional features and support for $4 per user each month compared to free version of Teams that arrived in 2018, Microsoft said. “It’s the first standalone offering of Microsoft Teams designed specifically with small businesses in mind,” said Jared Spataro in a blog post on Wednesday.

Teams Essentials includes a range of core features also available in the free tier, including persistent chat and video call functionality such as virtual backgrounds, meeting lobby, and the immersive Together Mode. There’s also a Google Calendar integration on the way “soon,” Microsoft said.

There are some differences with the free product, however. Teams Essentials provides users with 10GB of cloud file storage — that’s double the amount of the free version, which has now been reduced from 10GB to 5GB.

Teams Essentials also allows group video calls of up to 30 hours, with up to 300 participants in a single meeting. This contrasts with the 60 minutes of group video calls with up to 100 participants available to users of the free tier. (Microsoft temporarily extended the free version limit to 30 hours of group video calls and up to 300 participants early on in the COVID-19 pandemic; that offer is no longer available.) “With the introduction of Teams Essentials and our new normal since the pandemic, we are reinstating previous limits,” a Microsoft spokesperson said.

Another advantage of Teams Essentials over the free tier is phone and web support for Essentials customers.

The new subscription enables Microsoft to address the needs of small businesses that may require different features and enhanced support that are not available for free, said Daniel Newman, principal analyst at Futurum Research.

It’s an example of Microsoft tailoring a product to the needs of a specific audience – in this case small businesses, one that is often underserved, he said. “Microsoft has done this successfully with other offerings to address education and small business and I see this as a continuation of a strategy that has worked,” said Newman.

He added that, with hybrid and remote work set to remain for many organizations, “the challenge for small businesses to compete will benefit greatly from access to technology that is uniquely designed for their needs.”

There are several ways to access Teams, which has 250 million monthly active users globally. This includes Microsoft 365 Business Basics — at $5 per user each month — which includes Teams, as well as other productivity and collaboration apps. Business Basics also provides 1TB of storage and additional Teams meetings features such as meeting recordings, transcripts, and breakout rooms.

Microsoft Teams Essential is available now, both directly from Microsoft and via channel partners.

Copyright © 2021 IDG Communications, Inc.

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