Microsoft Teams
Microsoft Teams is Microsoft 365's hub for chat, channels, meetings, calling and file collaboration. Each team is backed by a Microsoft 365 group, a SharePoint site and an Exchange mailbox, and Teams is also a main place where Copilot and agents meet users.1
Also known as Teams, Microsoft Teams Enterprise, Microsoft Teams EEA, Microsoft Teams Essentials
- Intended for
- Employees and frontline workers, Microsoft 365 and Teams administrators, Unified communications and voice teams, Developers building apps and agents for Teams
- Runs on
- Microsoft 365 cloud service, Desktop, web and mobile clients, Teams Rooms and shared devices, US Government clouds with feature differences
At a glance
- What is it?
- Teams is the collaboration app of Microsoft 365, built on Microsoft 365 groups, Microsoft Graph and the same security and compliance controls as the rest of Microsoft 365, with identities stored in Microsoft Entra ID. Since 1 April 2024, new enterprise customers buy Teams separately from Microsoft 365 or Office 365 E1, E3 and E5 suites (no Teams), as Microsoft Teams Enterprise or Microsoft Teams EEA; in the EEA and Switzerland this applied from 1 October 2023. Business and frontline suites come in versions with and without Teams, and Microsoft 365 E7 is also sold with or without Teams. Telephony, premium meeting features and room devices are add-on licenses.123
- What does it do?
- Teams provides one-to-one and group chat, team channels, meetings and large events, and VoIP calling within the organization, with files stored in SharePoint and OneDrive. Users can include guests and external users. Add-ons extend it: Teams Phone for PBX features and PSTN calling, Audio Conferencing for dial-in, Teams Premium for intelligent meetings and advanced protection, Teams Rooms for meeting rooms, and capacity packs for events of up to 100,000 attendees. Copilot works in meetings, events and calls for licensed users, Copilot Chat is available as a Teams app, and Teams is a publishing channel for agents built in Copilot Studio, Foundry, the Agents SDK or the Teams SDK.124
- Who needs it?
- Organizations on Microsoft 365 that want chat, meetings, calling and shared files in one place tied to their existing identities, mailboxes and SharePoint. It also matters to organizations rolling out Copilot and agents, because Teams is where many employees already work and where meeting recaps and agents surface.1
- What does it need?2
- A Teams license: a suite with Teams, or for new enterprise customers a suite without Teams plus Microsoft Teams Enterprise or Microsoft Teams EEA
- Microsoft Entra ID identities and Exchange Online and SharePoint in the tenant
- Add-on licenses where needed: Teams Phone and a PSTN option, Audio Conferencing, Teams Premium, Teams Rooms
- For Copilot in meetings: a Microsoft Copilot add-on license for users and a transcription policy that fits how you want Copilot to work
- What it is not
- Teams is not a standalone file store: team files live in SharePoint and personal files in OneDrive. Basic Teams licenses do not include a phone system; PSTN calling needs Teams Phone plus a calling plan or another connectivity option. Meeting AI features need a Microsoft Copilot license, not just Teams. New enterprise customers should not assume Teams comes with their E3 or E5 suite, since those suites with Teams are no longer sold to new customers.25
Availability and licensing. Generally available (checked 26 Oct 2026). Since 1 April 2024, new enterprise customers buy Teams as a standalone Microsoft Teams Enterprise or Teams EEA license next to E1, E3 or E5 suites without Teams (from 1 October 2023 in the EEA and Switzerland); existing subscribers can keep suites with Teams. Business and frontline suites, and Microsoft 365 E7, are offered with and without Teams. Teams Phone, Audio Conferencing, Teams Premium and Teams Rooms Pro are paid add-ons. Prices were not verified today because Microsoft's Teams pricing pages did not load.2
The problem it solves
Work conversations spread across email, chat tools, meeting software and file shares make it hard to find decisions and keep context. Running separate products also means separate identities, security policies and compliance tools.
Teams puts chat, meetings, calling and files in one client on top of Microsoft 365 groups, SharePoint and Exchange, so existing identity, retention and compliance settings apply. With Copilot and agents, Teams also becomes a front end for AI, which raises the stakes for permission hygiene in the underlying SharePoint sites.
How it works
Microsoft documents the building blocks of a team:
- A new Microsoft 365 group for membership.
- A SharePoint site and document library for team files.
- An Exchange Online shared mailbox and calendar.
- A OneNote notebook, with ties to Planner and Power BI.
Identities come from Microsoft Entra ID. Admins manage settings and policies in the Teams admin center, including meeting policies that control Copilot and transcription. Apps and agents are added through app management, and developers build them with the Teams platform, the Teams SDK or the Microsoft 365 Agents SDK.1
Diagram as a list
Copilot & business apps
- Teams clients (desktop, web, mobile)Chat, channels, meetings, calls and apps for users
Agents & automation
- Apps and agents (Copilot, Copilot Chat, custom agents, third-party apps)AI assistants and business apps used inside Teams
Data & analytics
- Team (Microsoft 365 group)Membership and the container for a team's resources
- SharePoint site and document libraryStores team files
- Exchange Online shared mailbox and calendarTeam mailbox and calendar
Security, identity & governance
- Microsoft Entra IDUser identities for TeamsConnects to Teams clients (desktop, web, mobile)
- Teams admin centerSettings, meeting policies, app policies and Copilot controls
Cloud & hybrid infrastructure
- Teams Phone and PSTN connectivityPBX features and external calling through add-on licensesConnects to Teams clients (desktop, web, mobile)
Capabilities
Teams, channels and chat on Microsoft 365 groups1
Each team creates a Microsoft 365 group, a SharePoint site and library, an Exchange shared mailbox and calendar and a OneNote notebook.
Why it matters: Collaboration inherits existing identity, storage, retention and compliance controls.
Limits: Every new team adds a group and a site, so governance of team creation and sharing matters.
Meetings and large events25
Meetings with Copilot support up to 1,000 attendees for licensed users, and Attendee Capacity Packs let organizers host events for up to 100,000 attendees.
Why it matters: One platform covers daily meetings and company-wide events.
Limits: Larger events need capacity pack add-ons, and in events optimized for large audiences only organizers, co-organizers and presenters can use Copilot.
Teams Phone and PSTN calling2
Teams Phone Standard adds PBX features such as voicemail, call queues and auto attendants; PSTN connectivity comes from Microsoft Calling Plans, Operator Connect, Teams Phone Mobile, Direct Routing or Shared Calling.
Why it matters: Can replace a separate phone system.
Limits: Teams Phone is a separate add-on license, and Calling Plans are available only in some countries and regions.
Copilot in meetings, events and calls5
Licensed users can ask Copilot about who said what, where people agree or disagree and follow-up tasks; organizers set Copilot to during and after the meeting, only during, or off.
Why it matters: Meeting content becomes searchable and summarizable without manual notes.
Limits: Needs a Microsoft Copilot add-on license; not available in end-to-end encrypted meetings or in GCC High; turning Copilot off also turns off recording and transcription.
Apps and agents in Teams78
Admins add third-party apps; agents from Copilot Studio, Foundry, the Microsoft 365 Agents SDK and the Teams SDK can be published to Teams, and Copilot Chat runs as a Teams app.
Why it matters: Teams becomes a front end for business apps and AI assistants.
Limits: Copilot Chat in Teams is one app for all users, so admins must use app permission policies to limit it to licensed users if needed.
Add-on meeting and room options2
Teams Premium adds intelligent meetings, enhanced meeting protection and advanced reporting; Teams Rooms Basic is free for up to 25 rooms and Teams Rooms Pro adds advanced management.
Why it matters: Organizations can buy advanced features only for the users and rooms that need them.
Limits: Each add-on is licensed separately; the Teams Shared Devices license was renamed Teams Shared Space in April 2026.
Practical use cases
Meeting decisions get lost because nobody takes notes.
- Approach
- License Copilot for regular meeting participants and set a meeting policy that keeps transcripts so Copilot can recap during and after meetings.
- Role of Microsoft Teams
- Teams hosts the meeting and transcript; Copilot summarizes and lists follow-ups.
- Data, infrastructure and skills
- Microsoft Copilot add-on licenses and a transcription policy.
- Type of benefit
- Time saved on note taking
- Caveats
- Not available in end-to-end encrypted meetings or GCC High; check retention rules for Copilot prompts.
- First step
- Set the Copilot meeting policy for a pilot group in the Teams admin center.
A company wants employees to find an internal HR or IT agent without installing anything new.
- Approach
- Publish the agent from Copilot Studio or the Agents SDK to Teams and Microsoft Copilot and let admins deploy it to the right groups.
- Role of Microsoft Teams
- Teams is the channel where employees use the agent.
- Data, infrastructure and skills
- An agent built in a supported tool and admin approval to deploy it.
- Type of benefit
- Faster adoption of internal tools
- Caveats
- Test with a small group before wide availability.
- First step
- Publish the agent for yourself in Teams and test it.
An organization wants to replace its separate phone system.
- Approach
- Add Teams Phone Standard and choose a PSTN option such as Microsoft Calling Plans, Operator Connect or Direct Routing.
- Role of Microsoft Teams
- Teams provides the PBX features and calling client.
- Data, infrastructure and skills
- Teams Phone licenses and a PSTN connectivity option available in your region.
- Type of benefit
- Fewer separate systems
- Caveats
- Calling Plan availability varies by country; Direct Routing needs a supported session border controller.
- First step
- Check country availability for Calling Plans and Operator Connect carriers.
Who uses it
PepsiCo
In productionPepsiCo: one collaboration platform as the base for Copilot
90% to 95% daily active use (measured)
Retail and consumer goods, United States (Microsoft's tag); operations in more than 200 countries
Banco Popular Dominicano
In productionBanco Popular Dominicano: AURA agents for operational risk
100% coverage (measured)
Financial services, Dominican Republic
Works with
Requires
- Microsoft EntraTeams uses identities stored in Microsoft Entra ID.
Optional integration
- Microsoft 365 CopilotCopilot works in Teams meetings, events and calls for licensed users.
- Microsoft Copilot ChatCopilot Chat runs in Teams as an app managed in the Teams admin center.
- Microsoft Copilot StudioTeams and Microsoft Copilot is a publishing channel for Copilot Studio agents.
- Microsoft 365 Agents SDKTeams is a channel for agents built with the Agents SDK.
- Power BITeams ties into other Microsoft 365 apps such as Planner and Power BI.
Same family
- Microsoft 365 E7Microsoft 365 E7 is sold with Teams or in a No Teams version.
Optional integration for
- Microsoft 365 Agents SDKTeams is a primary channel for SDK agents.
- Microsoft Copilot ChatCopilot Chat is available in Teams, managed as a Teams app in the Teams admin center.
- Microsoft 365 CopilotCopilot runs in Teams meetings, events and calls for licensed users, and Teams meeting summaries are part of the in-app features.
- Microsoft Copilot StudioTeams and Microsoft Copilot is a primary publishing channel.
- Microsoft Industry Solutions and Dynamics 365 SustainabilityVirtual Visits and EHR-connected consultations run in Microsoft Teams.
- Microsoft Foundry Agent ServiceAgents can be published to Microsoft Teams.
- Microsoft 365 E7Included in the standard version; the No Teams version leaves it out.
Relationship labels follow Microsoft's documentation. "Alternative approaches" does not mean one is better: each profile says when it fits.
Getting started
Check licensing
Confirm whether users have Teams through their suite or need Microsoft Teams Enterprise or EEA alongside a no-Teams suite.
Check: Each user has a Teams service plan assigned in the Microsoft 365 admin center.
Plan deployment
Follow the Teams deployment overview and set up secure file sharing and collaboration.
Check: Team creation, guest access and external access policies are decided and set.
Configure policies
In the Teams admin center set meeting, messaging and app permission policies, including Copilot and transcription settings.
Check: A test user sees the expected meeting options and allowed apps.
Add voice if needed
Buy Teams Phone and a PSTN option and configure numbers.
Check: A test user can place and receive an external call.
Official resources
Deciding whether you need it?
Three free tools apply Microsoft's own published guidance to your situation, and say when Microsoft Teams or any new technology is not needed.
Sources
Each statement above links to the source it comes from. Labels say who reported it.
- Introduction to Microsoft Teams for admins (Microsoft Learn) (opens in a new tab)
- Microsoft Teams add-on licenses (Microsoft Learn) (opens in a new tab)
- Introducing the First Frontier Suite built on Intelligence + Trust (Official Microsoft Blog, 9 March 2026) (opens in a new tab)
- Custom engine agents for Microsoft 365 (opens in a new tab)
- Manage Microsoft Copilot in Teams meetings and events (Microsoft Learn) (opens in a new tab)
- License options for Microsoft Copilot (Microsoft Learn) (opens in a new tab)
- Manage Copilot Chat (Microsoft Learn) (opens in a new tab)
- Publish and deploy your agent: Microsoft Copilot Studio (Microsoft Learn) (opens in a new tab)
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