Microsoft Teams Calling Costs: Direct Routing vs an Operator Licence

Teams calling is priced in two quite different ways, and which is cheaper flips depending on how many people you have and how much they actually call. The number of licences is not the deciding factor people assume.

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There are two routes and they are priced on opposite things

Turning Teams into your phone system can be done two ways. The first is Direct Routing: a session border controller and SIP trunks connect Teams to the phone network through a provider, and you pay for the trunks and the calls plus a Microsoft licence for each user who makes external calls. The second is an operator-provided calling plan or Operator Connect arrangement, where the provider is wired into Teams natively and you buy a per-user bundle that includes the minutes.

The reason this matters commercially is that the two are priced on different things. Direct Routing costs scale mainly with capacity — how many simultaneous calls you need — so a business with two hundred staff where twenty are on the phone at once pays for twenty, not two hundred. A per-user plan costs scale with headcount regardless of use. For a contact-centre-shaped business Direct Routing is usually markedly cheaper; for a small office where everyone occasionally makes a call, the per-user plan is simpler and frequently cheaper once you count the setup.

The part people miss is the Microsoft licence underneath both. Teams Phone is a separate Microsoft licence from the Microsoft 365 subscription in most plans, and it is required for external calling regardless of which route you take. A quote that looks unusually cheap is often one that has quietly assumed you already hold it, or that only some of your staff need it — which may be true, and is worth establishing rather than discovering on the first bill.

What you are actually paying for

Microsoft licence

Teams Phone, per user who makes external calls. Required either way. The most commonly omitted line in a comparison.

Direct Routing

Trunks priced on concurrent calls, not headcount. Cheaper at scale and where call volume is concentrated in a few people.

Operator plan

Per user, minutes included, no SBC to run. Simpler, and usually cheaper for smaller or evenly-spread teams.

Concurrency

How many calls happen at once at your busiest point. This sizes Direct Routing, and it is almost never the headcount.

Session border controller

Required for Direct Routing, as hardware or hosted. A real cost, and one that only pays back above a certain size.

Call queues and reception

Teams handles basic routing natively. Anything resembling a contact centre needs a layer on top, priced separately.

Who we work with

We are independent of any single network or vendor, so the recommendation follows the requirement.

Telephony platforms

Hosted, on-premise or Microsoft Teams — the right answer depends on the building, not on what we prefer to sell.

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Which route usually wins

Under about twenty-five users, evenly spread — an operator plan, almost always, for the simplicity
Large headcount, small number actually on the phone — Direct Routing, priced on concurrency rather than seats
Heavy outbound calling — Direct Routing, because minute bundles stop being good value quickly
You already have SIP trunks and a provider you are happy with — Direct Routing reuses them
You want nothing to administer — an operator plan, and accept a slightly higher per-user figure for it
You need call queues, wallboards or recording at contact-centre depth — neither alone; that is an added layer

Microsoft Teams Calling Costs: Direct Routing vs an Operator Licence — Common Questions

Do we need a Microsoft licence as well as a provider?

Yes, in almost all cases. Teams Phone is a separate Microsoft licence from the Microsoft 365 subscription and it is required for external calling whichever route you take. A quote that looks unusually cheap has frequently assumed you already hold it. Worth establishing before comparing anything else, because it applies to both options equally.

Which is cheaper, Direct Routing or an operator plan?

It flips with size and call pattern. Direct Routing is priced mainly on concurrent calls, so a large business where only a fraction are on the phone at once pays for the fraction. An operator plan is per user regardless of use. Below roughly twenty-five evenly-spread users the operator plan usually wins on total cost once setup is counted.

What is concurrency and why does it matter more than headcount?

It is how many calls are happening simultaneously at your busiest moment, and it is what actually sizes a trunk-based service. Two hundred staff might peak at twenty calls at once. Sizing on headcount rather than concurrency is the most common and most expensive mistake in this comparison, in both directions.

Do we need a session border controller?

For Direct Routing, yes — as hardware or as a hosted service. It is a real cost and it is why Direct Routing does not pay back below a certain size. An operator plan needs none, which is a large part of why it is simpler for smaller businesses even where the per-user figure looks higher.

Can Teams do call queues and reception properly?

It handles basic auto attendants and call queues natively, which suits most offices. Anything resembling a contact centre — live wallboards, supervisor views, detailed historical reporting — needs a layer on top and is priced separately. If somebody on your team needs to watch a queue in real time, budget for that rather than assuming Teams covers it.

Is Teams calling always the right answer if we use Microsoft 365?

No. It suits desk-based businesses very well and warehouse or field-based ones considerably less, because it assumes people are at a device with Teams open. Where staff are on a floor or in vans, a cloud phone system with mobiles as extensions usually works better, and we would say so rather than sell you the Microsoft-shaped answer.

Want the arithmetic done on your numbers?

Tell us your headcount, roughly how many people are on a call at the busiest moment, and whether you already hold Teams Phone licences. That is enough to say which route is cheaper for you — and we will say so plainly when the simpler one wins.

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