TL;DR: Microsoft Teams Phone is the best business phone system for organisations already on Microsoft 365, adding PSTN calling inside the Teams app users already live in, with enterprise-grade compliance and a 99.999% uptime SLA. The fit is unbeatable for Microsoft shops, but layered licensing (a base Microsoft 365 licence plus the phone add-on plus a calling plan) makes both the setup and the true cost harder to pin down. App Score: 7.7/10.

How we scored Microsoft Teams Phone

Weighted against our business phone systems rubric. Sub-scores out of 10; weight in brackets.

Call quality & reliability (25%)8.5
Features (AI, messaging, video) (20%)8
Integrations (15%)9
Ease of setup & admin (15%)6
Value per user (15%)6.5
Support (10%)7.5
Weighted total7.7/10

Our independent score, from our own weighted rubric and verified pricing, kept separate from any sponsorship. Our methodology.

Microsoft Teams Phone at a glance
Starting price From ~$8/user/mo add-on (+ M365)
Monthly billing ~$8/user/mo add-on
Plans Teams Phone add-on ~$8 + a Calling Plan (~$15) or Operator Connect/direct routing
Unlimited calling Via calling plan
International Microsoft Calling Plans
Key features Turns Teams into a phone system; enterprise directory; Teams video
Reliability & support 99.9% SLA; Microsoft support
Integrations Deep Microsoft 365 integration
Best for All-Microsoft 365 organisations
Free trial Varies

Microsoft Teams Phone is the cloud calling layer that turns Teams into a full business phone system with PSTN connectivity. It adds auto-attendants, call queues, voicemail transcription and enterprise compliance on top of the Teams client, with a choice of connecting calls via a Microsoft Calling Plan, Operator Connect or Direct Routing to keep your existing carrier.

Key Features of Microsoft Teams Phone

  • Cloud PBX in Teams: auto-attendants, call queues and routing inside Teams.
  • Flexible PSTN: Microsoft Calling Plans, Operator Connect or Direct Routing.
  • Voicemail transcription: plus call transfer, hold and delegation.
  • Enterprise compliance: spam-call filtering and a 99.999% uptime SLA.
  • Device ecosystem: certified Teams handsets and headsets.
  • Full M365 tie-in: presence, Outlook and calendar integration.

Who Microsoft Teams Phone Is Best For

Teams Phone is the obvious choice for organisations already running Microsoft 365 that want to consolidate telephony into Teams. Businesses not on Microsoft, or those wanting one simple all-inclusive per-user price, will find Nextiva or 8×8 easier to buy and run.

Pros and Cons

Pros

  • Unbeatable fit for existing Microsoft 365 organisations
  • Flexible PSTN routes including keeping your own carrier
  • Enterprise-grade compliance and a 99.999% uptime SLA

Cons

  • Licensing is genuinely confusing (base licence + add-on + calling plan)
  • Layered cost often reaches $23-$44 per user once stacked
  • Weak value for non-Microsoft businesses

Verdict

Teams Phone is the right answer for Microsoft-committed organisations and a credibility fixture in any 2026 business phone list, but the layered licensing is a real hurdle. See where it ranks in our best business phone systems guide.

Comparing your options? See how Microsoft Teams Phone lines up against the rest of the field in our best RingCentral alternatives roundup.

Related guides

Compare more in our cluster: Best Business Phone Systems for Small Business and Cheapest VoIP Services.

Frequently Asked Questions

How much does Microsoft Teams Phone cost?

Teams Phone Standard is $10/user/month, rising to $17/user/month with a domestic calling plan and $34/user/month for international calling. All of these sit on top of a qualifying Microsoft 365 or Teams base licence, which is not included in those prices.

Do I need a Microsoft 365 licence?

Yes. Teams Phone add-ons require a qualifying Teams or Microsoft 365 licence underneath them.

What is the difference between the $13 and $17 plans?

The pay-as-you-go option (around $13/user/month) meters outbound calls, while the $17/user/month plan includes 3,000 bundled domestic minutes.

Can I keep my existing carrier?

Yes. Operator Connect or Direct Routing let you bring your own carrier instead of buying a Microsoft Calling Plan.
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