The Hidden Microsoft Teams Costs Draining Your IT Budget And How to Stop Them

As organisations transition to hybrid and remote collaboration, Microsoft Teams has become indispensable, but it's also quietly billing its way into your budget.

1. The Core Teams License

Microsoft Teams, the workhorse of enterprise communication, now requires per-user licensing, even if bundled with M365. At roughly £3.30 / $4 per user monthly, that’s ~$48,000/year for 1,000 users. It’s a non-negotiable baseline cost that becomes especially notable in multi-tenant or international environments where duplication can inflate spend.

2. Teams Premium Add-On

Upgraded features like AI meeting insights, branded virtual experiences, and enhanced security come at a price (around £5.80 / $7 per user/month). The cost multiplies fast if assigned broadly instead of reserved for roles that truly need it, like event hosts or compliance teams.

3. Handsets & Meeting Room Equipment

Despite softphone adoption, physical devices remain essential, especially for call centers or boardrooms. From high-end webcams to Teams Rooms systems, costs can climb to ~$50,000/year when factoring replacement cycles and support needs.

4. Shared Device Licenses

In hot-desking or shared-device setups, each device needs its own Teams license on top of user licenses. At $8/month per device, a workspace-lean environment can still rack up **$2,400/year**.

5. Compliance Call Recording

Businesses that take payments or fall under regulatory mandates must invest in third-party compliance tools (e.g. Dubber, Theta Lake). The cost can run to ~$13,485/year, but the risk of non-compliance, both financial and reputational, makes it indispensable.

6. Extra Reporting & Analytics

Teams' built-in call reporting is limited, fine for usage summaries, but not business intelligence. Third-party solutions (like Akixi or Analytics 365) are essential for trend analysis and capacity planning, adding ~$24,000/year to your budget, or you DIY via Graph API, which costs admin time instead.

7. Setup & Training Time

Beyond software, introducing Teams voice requires planning, process documentation, and user training, plus specialized admin skills. For even moderate-scale deployments, this internal effort may cost upwards of ~$100,000/year in dedicated staff time or consultancy.

8. Ongoing Provisioning of New Users

Every new hire means manual setups: Azure AD configurations, Teams policies, phone assignments, and testing. Scale that across hundreds of staff annually, and manual provisioning costs ~$25,000/year.

9. Moves, Adds & Changes (MAC)

Routine changes like role shifts or staff departures trigger provisioning tickets. At $44.57 per correct change and ~$78.83 if errors occur, a midsize org with 50 monthly changes can incur ~$23,600/year, escalating dramatically under higher turnover.

10. Storage & CDN Infrastructure

Teams stores files in SharePoint/OneDrive and relies on Microsoft’s CDN for performance. High-density collaboration or large media volumes may require extra storage or CDN architecture work. These enhancements cost around ~$9,000/year, and are key for maintaining responsiveness.

11. PSTN Connectivity Costs

Building your Teams phone system, via Calling Plans, Direct Routing, or Operator Connect, brings licensing, porting, call charges, and maintenance spend. Together, running Teams voice at scale costs ~$92,700/year, especially if international dialing is enabled broadly.

12. Integration with External Apps & Systems

While Teams integrates seamlessly with Microsoft ecosystem tools (e.g. Power Automate, Dynamics), tying in non-Microsoft platforms like Salesforce or custom APIs requires significant engineering. Large-scale integration efforts can reach hundreds of thousands in one-off development costs.

13. Copilot & AI Features

Copilot can transform productivity, some firms report 10–50% time savings in documentation tasks, but it comes with licensing costs. For 1,000 users, that’s an estimated ~$7,200/year, which may not always align with ROI.

Key Takeaways for IT Admins

• Teams increasingly demands line-item budgeting: the era of “free collaboration” has passed.

• Optional features can introduce significant extras: premium meeting tools, compliance needs, and advanced analytics all carry real costs.

• Hardware and shared devices create recurring budget impact.

• Without built-in reporting, the need for analytics drives up spend further.

Microsoft Teams Costs Out of Control? Here’s the Fix IT Leaders Are Using

Microsoft Teams can quietly eat into budgets when add-ons, compliance tools, and hardware are factored in. The good news: IT leaders are regaining control with smarter telephony strategies that keep Teams fully functional while making costs predictable.

See how Callroute helps organisations cut Teams spend without sacrificing performance.