Microsoft Teams Phone: How to Replace Your Business Phone System with an Add-On License

If your organization already uses Microsoft Teams, you may not realize you’re only one step away from transforming it into a complete business phone system. With an add-on Microsoft Teams Phone license, Teams can replace your legacy PBX or VoIP platform with a secure, cloud-based, fully integrated telephony solution.

For IT leaders, this isn’t just about making calls - it’s about simplifying infrastructure, reducing costs, supporting hybrid work, and unifying communication under one platform.  

In this article, we’ll explain what Microsoft Teams Phone is, explore key features, outline common use cases, and break down how licensing works.

What Is Microsoft Teams Phone?

Microsoft Teams Phone is a cloud-based phone system that integrates directly into Microsoft Teams. Instead of maintaining traditional desk phones or standalone VoIP systems, organizations can manage all their calling, collaboration, and conferencing through a single Microsoft 365 environment.

With Teams Phone, employees can:

• Make and receive calls to/from external landlines and mobile phones.

• Use familiar features like voicemail, call forwarding, transfers, and call queues.

• Join calls from Teams on any device (desktop, mobile, or browser).

• Eliminate on-premises phone infrastructure.

In short, Teams Phone delivers everything a traditional phone system does, but with the scalability, flexibility, and cost efficiency of the cloud.

Why Organizations Are Adopting Microsoft Teams Phone

For IT leaders balancing limited budgets, hybrid workforces, and evolving security requirements, Microsoft Teams Phone offers clear advantages:

• Consolidation: One platform for chat, meetings, collaboration, and phone calls.

• Flexibility: Supports in-office, remote, and hybrid work seamlessly.

• Scalability: Add or remove users instantly - no hardware needed.

• Security: Backed by Microsoft’s enterprise-grade compliance and encryption.

• Cost savings: Eliminate legacy PBX maintenance, hardware refreshes, and multiple vendor contracts.

By leveraging Teams Phone, businesses often see both IT simplification and total cost of ownership (TCO) reduction compared to standalone telephony solutions.

Key Features of Microsoft Teams Phone

Here’s what you get with a Microsoft Teams Phone license:

• External calling: Make and receive calls to any phone number, not just Teams users.

• Device flexibility: Call from desktops, laptops, mobile devices, or Teams-enabled conference hardware.

• Call management: Voicemail, call queues, auto attendants, call transfers, and forwarding.

• Integration: Deeply integrated with Microsoft 365 apps like Outlook and SharePoint.

• Advanced features: Call recording, compliance controls, and integration with contact center platforms.

Essentially, anything you’d expect from a traditional PBX or VoIP system, but natively tied into the Microsoft 365 ecosystem.

Common Use Cases for Microsoft Teams Phone

Organizations across industries are deploying Teams Phone to simplify communications and support modern work. Here are the top scenarios we see:

1. Eliminating Traditional Desk Phones

Companies with on-premises phone systems often face ongoing costs for hardware maintenance, carrier contracts, and IT support. By moving to Teams Phone, you can:

• Retire desk phones entirely.

• Eliminate on-site PBX equipment.

• Let Microsoft handle the infrastructure in the cloud.

This reduces both capital expenses (CapEx) and operational expenses (OpEx).

2. Supporting Remote and Hybrid Workforces

Modern employees need to work from anywhere without losing connectivity. With Teams Phone:

• Employees can use any device (laptop, tablet, mobile) as their business phone.

• IT doesn’t need to ship or manage hardware phones for remote workers.

• Workers stay reachable on a single business number, whether in-office or remote.

This is particularly valuable for organizations with small IT teams that need easy, low-maintenance solutions.

3. Virtual Reception and Call Routing

Teams Phone includes auto attendants and call queues, making it easy to:

• Route incoming calls to the right department or person.

• Transfer callers to voicemail.

• Provide recorded greetings and menus (e.g., “Press 1 for Sales, Press 2 for Support”).

For organizations without a dedicated receptionist or contact center, Teams Phone provides professional-grade call management with minimal setup.

4. Integrating with Contact Centers

For businesses with advanced customer service needs, Teams Phone integrates with third-party contact center platforms. This enables advanced routing, analytics, and AI-powered customer experiences while still leveraging Microsoft’s secure telephony backbone.

Microsoft Teams Phone Licensing: How It Works

Licensing is often the biggest question we hear from clients. Fortunately, Microsoft Teams Phone licensing is straightforward.

• Base requirement: A Microsoft 365 or Office 365 plan that includes Teams.

• Add-on license: A Microsoft Teams Phone license is purchased on top of the base plan.

• Calling plans: You can either buy Microsoft’s calling plan or integrate your own carrier via Direct Routing.

Example

• You already have Microsoft 365 E3 for all employees.

• You purchase Teams Phone licenses for only the employees who need telephony features.

• Each licensed user gets business phone capabilities directly inside Teams.

This flexibility allows organizations to control costs by only assigning Teams Phone licenses where needed.

Cost Savings with Microsoft Teams Phone

One of the biggest drivers for adopting Microsoft Teams Phone is cost reduction. Traditional telephony systems come with a variety of ongoing expenses, from hardware and carrier contracts to licensing and support. By consolidating communications into Microsoft Teams, organizations can eliminate many of these costs while gaining modern flexibility.

Savings typically come from:

• Eliminating PBX hardware refresh cycles.

• Reducing carrier contracts and multiple vendor bills.

• Avoiding costs of separate VoIP or UCaaS providers.

While exact savings vary by organization, the broader financial benefits go beyond monthly bills:

• Predictable costs through subscription-based licensing.

• Reduced downtime risk, since Microsoft manages the infrastructure.

• Better ROI on Microsoft 365, by fully leveraging a platform you already own.

When viewed holistically, Teams Phone is more than a phone system replacement - it’s also a cost-optimization strategy that frees up resources for more strategic IT initiatives.

Microsoft Teams Phone vs. Other Cloud Telephony Options

IT leaders often ask how Microsoft Teams Phone compares to standalone providers like Zoom Phone, RingCentral, or 8x8. Here’s how it stacks up:

• Integration: Teams Phone wins because it’s native to Microsoft 365 - no third-party connectors required.

• Simplicity: One vendor, one environment, one admin console.

• Cost efficiency: No need to manage overlapping tools for collaboration + telephony.

• Ecosystem: Access to Microsoft’s entire AI, security, and compliance suite.

While standalone providers may offer niche features, most organizations already invested in Microsoft 365 see greater ROI from Teams Phone due to consolidation.

Frequently Asked Questions (FAQs)

1. What is Microsoft Teams Phone?
Microsoft Teams Phone is a cloud-based phone system that lets you make and receive calls from Microsoft Teams.

2. Do I need special hardware?
No. Teams Phone works on any device running Microsoft Teams. Desk phones are optional.

3. How much does a Teams Phone license cost?
Pricing depends on your Microsoft 365 plan and whether you purchase Microsoft’s calling plan. An Opkalla Technology Advisor can optimize your licensing for cost savings.

4. Can Teams Phone replace our entire PBX system?
Yes. Teams Phone can fully replace legacy PBX systems and integrates with third-party contact centers if needed.

5. Is Teams Phone secure?
Yes. It leverages Microsoft’s enterprise-grade security, encryption, and compliance frameworks.

How Opkalla Helps with Microsoft Teams Phone

While Microsoft Teams Phone licensing is straightforward, navigating Microsoft’s broader licensing ecosystem isn’t always easy. That’s where Opkalla comes in.

We help IT leaders:

• Evaluate Microsoft license types and choose the most cost-effective option.

• Deploy Teams Phone without disrupting operations.

• Integrate Teams Phone into your broader Microsoft technology management strategy.

• Provide ongoing support and managed services for optimization.

Final Thoughts

Microsoft Teams Phone is a modern, cloud-based business phone solution that empowers organizations to simplify IT, reduce costs, and enable flexible work. And it’s easily attainable as a simple add-on license.

If your organization already uses Microsoft Teams, adopting Teams Phone is a natural next step. By consolidating telephony with collaboration and productivity tools, you gain a unified, secure, and scalable communication platform.

At Opkalla, we specialize in helping organizations evaluate Microsoft license types, implement Microsoft Teams Phone, and maximize the ROI of their Microsoft technology investments.

Ready to explore Microsoft Teams Phone for your business? Connect with an Opkalla Microsoft Specialist today to learn next steps on how we can help you modernize your phone system and streamline your IT strategy.