Microsoft Teams cross-restore and licensing changes: What MSPs need to know

Microsoft Teams® has become a critical tool for collaboration, making it essential for managed service providers (MSPs) to stay on top of licensing and data retention changes. Recent updates in Microsoft 365® impact how Teams is managed, particularly regarding SKU separation and backup recovery options. Follow along as we walk through key updates that affect Microsoft 365 licenses and how MSPs can ensure seamless renewals while leveraging new cloud backup capabilities.

Microsoft Teams and Microsoft 365: SKU separation

Last year, Microsoft made a significant change by separating Microsoft Teams from Microsoft 365, impacting how certain SKUs are purchased. While existing customers on these SKUs are unaffected, MSPs need to carefully manage renewals to ensure customers remain on the correct licensing structure.

Key considerations for MSPs

As renewals approach, make sure you:

• Identify customers on the impacted SKUs to avoid disruption
• Ensure proper licensing adjustments are made to maintain service continuity
• Communicate changes early so your customers understand the impact and take action

If these licensing changes aren't managed correctly, it could result in unwanted service disruptions. By staying ahead of renewals, you can ensure a seamless experience for your customers.

What this means for your customers

Customers who are already using Microsoft Teams as part of their Microsoft 365 licenses will not experience an immediate impact. However, new purchases or renewals now require Teams licensing to be handled separately, making it crucial for you to navigate these changes carefully.

Expanding cloud backup recovery: Microsoft Teams cross-restore

Beyond licensing changes, data retention remains a critical concern for MSPs managing Microsoft 365 environments. Microsoft’s retention policies have limitations, leaving businesses vulnerable to accidental data loss. To help address these gaps, ConnectWise introduced cross-teams channel restore last year, allowing partners to restore both public and private channels beyond Microsoft’s 30-day restoration window.

Now, we are taking it a step further with Microsoft Teams cross-restore (or X-restore)—a new feature that enables you to restore an entire Team to another Team of the same type (e.g., Team → Team). This enhancement ensures:

• Seamless data restoration: Recreating the original data structure for an intuitive user experience
• Extended retention: Overcoming Microsoft’s default limitations and ensuring long-term recoverability
• Faster resolution: Minimizing downtime and restoring critical collaboration environments quickly
• Preserving metadata and permissions: Ensuring teams retain their structure, settings, and security permissions

Why this matters for MSPs

With Teams cross-restore, you can deliver even more value to your customers by protecting their collaboration environments from accidental data loss, cyberthreats, and retention policy gaps. This is especially important for industries with strict compliance requirements where data availability is non-negotiable.

Driving renewals with proactive conversations

As these changes roll out, now is the perfect time to engage your customers in discussions about their Microsoft 365 licensing and data protection strategies. Here’s how you can lead the conversation:

• Educate customers on SKU changes and their impact on licensing options
• Highlight backup solutions that extend beyond Microsoft’s default retention policies
• Position data protection as a business continuity strategy, ensuring customers see the value in proactive data management
• Leverage Microsoft incentives for renewals, bundling backup services with licensing to enhance value

The business case for data protection

These licensing and retention updates present a great opportunity for you to strengthen customer relationships. By offering a proactive approach to licensing management and data protection, you can set yourself apart from competitors and drive recurring revenue.

Get started today

Ensuring customers are on the right licensing path and have strong data protection in place is key to long-term success.

Equip yourself with the insights and tools needed to navigate renewals successfully with the 2025 Microsoft Renewal Guide for MSPs. It’s designed to help you start meaningful conversations with your customers about Microsoft 365 licensing, data protection, and renewals.

Start the conversation now and leverage Microsoft Teams cross-restore capabilities to enhance data resilience.