Microsoft is introducing SMS messaging in Teams, bringing long-requested text functionality to its communication platform.
However, the implementation comes with major restrictions, making it a tool for business notifications rather than a full-fledged messaging service. This update arrives as Microsoft prepares to shut down Skype in May 2025, reinforcing its shift toward Teams as the company’s primary communication tool.
Despite this expansion, SMS in Teams does not provide standard two-way messaging. Instead, it appears to serve enterprise use cases such as automated customer notifications, service alerts, or authentication messages.
The decision to restrict SMS functionality aligns with Microsoft’s broader focus on positioning Teams as a workplace collaboration suite rather than a general-purpose messaging app.
How Microsoft Teams SMS Works
Microsoft has integrated SMS messaging into Teams through its Calling Plan service, enabling text-based communication within the platform.
However, this feature is currently limited to users in the United States, Puerto Rico, and Canada. Microsoft categorizes Teams SMS as “business messaging”, designed primarily for organizations rather than individual consumer use.
Teams SMS operates via Application-to-Person (A2P) messaging, meaning messages sent from Teams are classified as enterprise communication rather than personal texting.
Unlike conventional SMS services, which allow unrestricted messaging between mobile numbers, Teams’ implementation is tailored for business notifications, customer engagement, and authentication use cases.
Supported messages include appointment reminders, service alerts, and two-factor authentication codes.
For Teams users to send and receive SMS, their organization must subscribe to a Microsoft Calling Plan and ensure proper licensing.
Users must be assigned a Teams Phone number and be registered for SMS use under Microsoft’s requirements. To comply with messaging regulations in the U.S. and Canada, businesses must also register with The Campaign Registry (TCR) to verify their identity and intended use of SMS within the 10-Digit Long Code (10DLC) network.
Microsoft’s approach ensures compliance with telecom regulations while reducing the risk of SMS-based spam and fraud. However, it also means that Teams SMS is not a traditional texting service. Businesses looking to enable two-way messaging must confirm whether their use case aligns with Microsoft’s SMS policies and industry guidelines.
Security Implications of SMS Integration in Teams
With SMS now part of Teams, security concerns naturally follow. The platform has already been targeted by cybercriminals exploiting external communication features.
A report by ReliaQuest in October 2024 detailed how ransomware group Black Basta used Microsoft Teams to launch phishing attacks. By creating fake Microsoft Entra ID accounts and distributing malicious QR codes, attackers bypassed traditional email security and tricked employees into granting system access.
The addition of SMS raises concerns that attackers could attempt similar strategies through text-based phishing, or smishing. If external recipients can reply to messages or if SMS allows embedded links, organizations using the feature must implement additional safeguards.
Microsoft has previously introduced honeypot detection techniques to track phishing attempts, but external messaging capabilities always introduce new risks.
Skype’s Shutdown and Microsoft’s Communication Strategy
Microsoft’s decision to add SMS messaging in Teams comes at a time when it is finalizing its transition away from Skype. The company has confirmed that Skype will be fully discontinued in May 2025, following years of declining relevance as newer platforms gained market share.
Skype, which was once a leader in VoIP communication, gradually lost its dominance to services like Zoom, WhatsApp, and Discord. Microsoft first moved its enterprise customers away from Skype by discontinuing Skype for Business in 2021.
The consumer version of Skype continued to operate but received minimal updates. With Teams now the company’s central communication hub, the introduction of SMS appears to be part of Microsoft’s long-term strategy to fill specific messaging gaps while keeping its enterprise focus intact.
How SMS Fits Into Microsoft Teams’ Enterprise Expansion
Microsoft’s approach to SMS aligns with its broader strategy of expanding Teams for business communication rather than positioning it as a general-purpose messaging app.
In the past year, Microsoft has made several updates reinforcing this enterprise focus. The platform’s capacity for virtual events was enhanced when Teams Town Hall attendee limits were raised to 50,000, allowing companies to host large-scale webinars and all-hands meetings.
At the same time, Microsoft introduced Storyline, a LinkedIn-style internal social feed aimed at making Teams a hub for workplace updates and engagement.
This move, alongside AI-powered features like real-time voice translation, shows that Microsoft is building Teams into a workplace-first ecosystem rather than competing with consumer messaging apps.
Will Microsoft Expand Teams’ SMS Capabilities?
As Microsoft continues consolidating its communication tools under Teams, the question remains whether SMS will eventually evolve into a more robust messaging feature.
At present, its restrictive nature indicates that Microsoft is not looking to compete directly with services like WhatsApp or Telegram. Instead, the feature serves as another tool for businesses that need to send external messages without relying on third-party SMS solutions.
However, as external communication becomes increasingly important in hybrid workplaces, businesses may push for greater SMS functionality, including two-way messaging or deeper integration with Teams’ existing chat system. Whether Microsoft will expand this feature or maintain its current limited approach remains to be seen.
