Microsoft Teams Phone: Cut Your Business Phone Bill

Your team already lives in Microsoft Teams all day. So why are you still paying for a separate phone system bolted on beside it?

Most South Island businesses already run Microsoft 365 and use Teams every day, which means a complete business phone system can be built on software your team already knows. This post explains what Microsoft Teams Phone is, how the calling plans work, what licences you need, what it costs against a traditional setup, and how to move across without losing your numbers or your reception flow.

It is written for owners and managers weighing up their next phone bill, not for technical buyers. The generic question of cloud calling is covered separately; here the focus is the Microsoft angle.

What Is Microsoft Teams Phone?

Microsoft Teams Phone is the calling layer that turns Teams into a full business phone system, so the app your staff use for chat and meetings also makes and takes external phone calls. It adds a real phone number to each user and connects Teams to the public phone network. Plain Teams handles calls between your own staff; reaching outside landlines and mobiles is what the Teams Phone licence and a calling plan add on top.

In plain terms, Microsoft Teams Phone means a customer can ring your main business number and the call lands inside Teams, on a desk handset, a laptop, or a mobile, exactly like any normal phone call. Staff dial out the same way. There is no separate PBX cabinet, no separate app to learn, and no second login.

Picture a staff member already in Teams answering a message when the phone on the desk beside them rings on a separate system. Teams Phone removes that split: the call arrives in the same window they were already looking at, and they answer with a click.

Because it sits inside Microsoft 365 telephony, the calling features live in the same place as Outlook, SharePoint, and the rest of the toolset your team already opens every morning. Using Teams as a phone system this way keeps everything under one set of credentials.

How Is It Different From a Normal Phone System?

A normal phone system runs on its own hardware or its own separate cloud service, kept apart from your everyday software. Microsoft Teams Phone removes that separation by making the call a feature of software you already run.

The practical effect is one tool instead of three. Chat, video meetings, and phone calls share a single window, a single contact list, and a single set of administration controls. Staff barely notice the switch to Microsoft Teams Phone, because they are still working in the app they open first thing every morning.

How Do Microsoft Teams Calling Plans Work?

Teams calling plans are the part of the service that connects Teams to the outside phone network, and you choose one based on how your business actually makes calls. The plan is what lets a Teams user call any landline or mobile anywhere, not only colleagues inside your own organisation.

There are three common routes to live calling, and the right one depends on your call volumes and whether you want to keep your current phone provider.

Microsoft Calling Plans

Microsoft sells calling minutes directly as an add-on licence per user. You pick a domestic or international bundle, assign it, and the user can call out immediately. This is the simplest option and suits businesses that want everything on one Microsoft bill.

Operator Connect

With Operator Connect, a local telecommunications provider supplies the calling service and plugs it into Teams through the admin portal. You keep a New Zealand provider relationship and local support while the calls still run through Teams. This often works out cheaper for higher call volumes, and a cloud phone system provider can set this up and manage the numbers for you.

Direct Routing

Direct Routing connects Teams to an existing phone line or SIP service through a piece of session border controller equipment. It gives the most control and is used where a business has specific carrier contracts or unusual calling needs. It is the most technical of the three and usually warrants help to configure.

Which Plan Is Right for a Small Business?

Most small and medium South Island businesses adopting Microsoft Teams Phone land on either Microsoft Calling Plans or Operator Connect, and the choice usually comes down to how you want to be billed and supported. Microsoft Calling Plans keep everything on a single Microsoft invoice, which suits businesses that value simplicity above all. Operator Connect keeps a local provider in the picture, which often means better call rates at higher volumes and a New Zealand support team to call when something needs attention.

There is no universally correct answer, only the plan that fits your call patterns and how hands-on you want to be. A short review of your call volumes, destinations, and existing contracts points clearly to one option, and doing that before you commit to Microsoft Teams Phone means the running cost is known up front, not discovered later.

How Much Does Microsoft Teams Phone Cost a Business?

Microsoft Teams Phone usually costs less than a traditional phone system once line rental, handset hardware, maintenance, and call charges are added together. You pay a per-user monthly fee for the calling licence and the plan, and that single figure absorbs most of what used to arrive as separate bills.

A traditional setup carries recurring costs that are easy to forget until you add them up: per-line rental on each line, a maintenance contract on the PBX hardware, and a hardware refresh every five to seven years when the cabinet reaches end of life. Pull out your last few phone and line-rental invoices and the total usually surprises owners. Microsoft Teams Phone removes the cabinet and folds line rental into one predictable per-user figure.

Because the platform runs on the Microsoft 365 you already pay for, you are not buying a whole new system, only the calling licence on top. Working out the real number means comparing your current phone bill, line rental, and maintenance against the per-user Teams cost, which is a comparison worth doing as part of IT budget planning for the year ahead.

What Licences Do You Actually Need?

Each user needs a Teams Phone licence, plus a calling plan to make and receive outside calls. The Teams Phone licence is included in Microsoft 365 E5, and on the more common business plans such as Business Standard or Business Premium it is added on per user. It pays to check exactly what your current Microsoft 365 plan includes before you budget, because the answer changes the per-user figure. Exodesk can confirm what you already hold and what needs adding.

What About Handsets?

You do not have to buy new desk phones. Most staff are happy using the Teams app on a laptop with a headset, or the mobile app. Where a physical handset is wanted, such as on a reception desk, certified Teams handsets plug straight in.

Why Replace Your PBX With Teams Phone?

The strongest reason to replace your PBX with Microsoft Teams Phone is that it removes a whole separate system, its hardware, and its support contract while putting calling where your team already works. The business stops maintaining two platforms and starts running one.

An ageing PBX cabinet is a liability waiting to surface. When it fails, calls stop, and the fix often means an engineer visit and parts that are increasingly hard to source. Moving calling into Microsoft 365 telephony hands that maintenance burden to the platform instead of your business.

There is also the copper question. New Zealand is steadily retiring copper phone lines, and businesses still on a traditional system will eventually be forced to change anyway. Choosing Microsoft Teams Phone now turns a looming forced migration into a planned upgrade on your own timeline.

Built-In Features You Already Have

Voicemail arrives in your inbox, calls forward to a mobile when you leave the office, and an auto attendant can answer and route callers to the right team. Call queues hold and distribute inbound enquiries so a busy spell does not mean callers hit a dead line and ring a competitor instead. These were once expensive add-ons and are now part of the platform.

Built for Hybrid and Multi-Site Teams

Because the number follows the user rather than the desk, staff answer the main business line from the office, from home, or from another branch with no special configuration. For a business with people split across remote work and several sites, that flexibility comes as standard with no extra setup.

Is Microsoft Teams Phone Secure and Easy to Manage?

Microsoft Teams Phone is administered through the same Microsoft 365 admin centre your IT support already uses, so calling is protected by the security controls and accounts that govern the rest of your business data. There is no separate phone system to secure, patch, or log into.

In practice this matters more than it sounds. Think of the staff member who left three months ago whose old desk phone could, on a separate system, still be forwarding to their personal mobile. With Microsoft Teams Phone, their calling access is switched off the moment their Microsoft 365 account is disabled, with nothing for anyone to remember. The same multi-factor authentication and sign-in rules that protect email also protect calling. For a small business with no dedicated phone administrator, that single point of control removes a real source of risk.

Adding a new staff member is equally simple. The same account that grants email and file access can be assigned a phone number and a calling plan in a few clicks, which keeps the phone system in step with staff changes instead of trailing behind them.

Who Manages the Day-to-Day?

Most owners do not want to run a phone system themselves, and they do not have to. An IT partner manages the licences, numbers, and call flows, so the business gets the benefit of Microsoft Teams Phone without learning the admin portal. Adding a user or changing a call queue becomes a quick support request, handled in minutes.

What Happens If the Internet Goes Down?

Because Microsoft Teams Phone runs over the internet, a connection outage affects calling, which is the most common concern owners raise. The standard answer is a backup path: calls can automatically divert to mobiles or another number when the main connection drops, so the business stays reachable. A sound internet connection with a sensible failover plan removes most of the worry, and it is something to confirm during planning rather than after go-live.

How Do You Move to Microsoft Teams Phone?

Moving to Microsoft Teams Phone is a planned project, not a flick of a switch, and the key steps are confirming licences, porting your existing numbers, setting up call routing, and testing before you cut over. Done properly, the change is invisible to your customers because your phone numbers stay the same.

The first step is checking your Microsoft 365 licences, since the calling capability sits in specific plans and may need an add-on. The second is porting your numbers across from your current provider, a process that takes planning and a confirmed cutover date so there is no gap in service.

From there, the auto attendant, call queues, and reception flow are built to match how your business answers calls today. Network readiness matters too, because call quality depends on a sound connection, which makes solid Microsoft 365 foundations and a tested network part of the groundwork.

A sensible rollout runs the new and old systems side by side for a short period. Staff get used to making calls in Teams while the previous phone system stays available as a safety net, and the old service is only switched off once everyone is comfortable. That parallel period takes the pressure off, so there is no single moment where everything has to work at once.

Exodesk works with businesses across Christchurch, Dunedin, and the wider South Island to check licensing, port numbers, configure call flows, and manage the move to Microsoft Teams Phone end to end, so the business never loses a day of calls.

Get Your Phone System Working Inside Teams

You already pay for Microsoft 365 and your team already works in Teams, so a modern phone system is closer than you think. Exodesk can review your licences and current phone costs and set up Microsoft Teams Phone so calls, chat, and meetings run from one place.

Contact us today to discuss how we can help your business or connect with us on LinkedIn to stay updated with more insights.

Frequently Asked Questions

What is Microsoft Teams Phone in simple terms?

It is an add-on that lets the Microsoft Teams app make and receive normal phone calls to and from any landline or mobile. It gives each staff member a real business phone number that works inside Teams on a laptop, desk phone, or mobile. It turns the software your team already uses for chat and meetings into a complete business phone system.

Do I need a separate phone system if I have Microsoft Teams?

No. With a calling plan added, Teams becomes the phone system itself, so a separate PBX or VoIP platform is not required. This removes the cost and maintenance of running a second system. Most businesses that adopt Teams Phone retire their old phone hardware entirely.

How do Teams calling plans work?

Teams calling plans connect Teams to the public phone network so users can call external numbers, not just colleagues. You can buy minutes directly from Microsoft, use a local provider through Operator Connect, or connect an existing line through Direct Routing. The right choice depends on your call volumes and whether you want to keep a New Zealand telecommunications provider.

Can I keep my existing business phone number?

Yes. Existing numbers are ported across to Teams Phone through a managed process, so customers keep calling the same number. The porting needs a planned cutover date to avoid any gap in service. Once complete, the number rings inside Teams just as it always did.

How much does Microsoft Teams Phone cost?

You pay a per-user monthly fee for the Teams Phone licence and chosen calling plan, which usually works out lower than a traditional system once line rental, hardware, and maintenance are added up. The Teams Phone licence is included in Microsoft 365 E5 and added on per user for plans such as Business Standard or Premium. A direct comparison against your current phone bill shows the real figure for your business.

Is Microsoft Teams Phone reliable for business calls?

Yes, on a properly configured network. Call quality depends on the quality of your internet connection rather than the technology itself, so network readiness testing is important before any rollout. With fibre broadband, which is now standard in most New Zealand business locations, business-grade call quality is the norm.

Do I need to buy new desk phones?

No. Staff can make and take calls using the Teams app on a laptop with a headset or on their mobile, so handsets are optional. Where a physical phone is wanted, such as a reception desk, certified Teams handsets are available. Many businesses move to Microsoft Teams Phone without buying any new hardware at all.

What is the difference between Microsoft Teams Phone and VoIP?

Teams Phone is a specific Microsoft service that delivers calling inside Teams, while VoIP is the general technology for making calls over the internet. Teams Phone is one way of using VoIP, integrated tightly with Microsoft 365. A standalone VoIP system is a separate platform rather than part of the Microsoft toolset.

Can remote and multi-site staff use the same phone system?

Yes. Because the phone number follows the user rather than a physical desk, staff answer the main business line from the office, from home, or from another branch. No special configuration is needed for each location. This makes it well suited to hybrid teams and businesses with sites in more than one town.

How long does it take to switch to Microsoft Teams Phone?

A typical switch takes a few weeks once licensing is confirmed, numbers are scheduled for porting, and call flows are configured and tested. The timeline depends mainly on how long number porting takes with your current provider. A managed rollout keeps the old system running until the new one is tested and ready.