WillDixon presents an in-depth guide on how Microsoft Teams uses encryption—including standard and end-to-end options—to secure sensitive data and support compliance for business communication.

Encryption in Microsoft Teams: How Microsoft Secures Collaboration and Communication

Introduction

Microsoft Teams is a key platform for business collaboration, handling sensitive data for over 320 million monthly users. The platform’s architecture supports a wide range of collaborative activities including messaging, file sharing, and meetings—all of which require strong security due to regulatory requirements and the prevalence of remote work.

Why Encryption Matters for Microsoft Teams

  • Protects intellectual property, financial details, and PII from interception and unauthorized access.
  • Supports legal and industry compliance (GDPR, HIPAA, PCI DSS, CCPA, NIST 800-53).
  • Maintains privacy and data integrity across varied business use cases.

Encryption Layers in Microsoft Teams

Teams protects data using multiple encryption mechanisms:

1. Transport Layer Security (TLS)

  • Uses TLS 1.2+ and AES-256 encryption for data in transit between clients and Microsoft servers.

2. Data at Rest Encryption

  • Utilizes BitLocker and per-file encryption for data stored in Azure, SharePoint, OneDrive, and other Microsoft 365 backends.

3. Service Encryption

  • Adds another layer by encrypting Teams data before storage using Microsoft-managed keys.
  • Service encryption covers media content, with ongoing expansion to additional Teams services.

4. Customer Key Encryption (BYOK)

  • Lets organizations supply and control their own encryption keys, enabling deeper data security management and regulatory control.
  • Integrated via Microsoft Purview Customer Key.
  • Supported for Teams files, chat messages, and other data modalities.

5. End-to-End Encryption (E2EE)

  • Available for one-to-one calls and certain meetings—especially for Teams Premium users.
  • E2EE keys are generated and managed on user devices, never accessible to Microsoft.
  • Covers audio, video, and screen sharing (not chat, files, or recordings).
  • Handshake uses DTLS and Group Key Manager Protocol; media stream encrypted with GCM_AES_256.
  • E2EE disables server-side features like recording, transcription, DLP, eDiscovery, and real-time anti-malware.

Compliance Considerations

Teams’ encryption options are designed to meet requirements for:

  • GDPR: Mandates robust technical controls for personal data security.
  • HIPAA: Requires protections for electronic protected health information (ePHI).
  • PCI DSS: Demands encryption of cardholder data during transmission.
  • CCPA/CPRA: Provides safe harbor for encrypted personal data.
  • NIST 800-53: Specifies cryptographic controls as a security baseline.

Trade-offs: Standard Encryption vs. End-to-End Encryption

  • Standard Encryption: Default for all Teams data in transit and at rest; does not inhibit service features.
  • E2EE: Provides maximum privacy for high-sensitivity scenarios but removes access to collaboration and compliance features reliant on server processing.
  • Limitations of E2EE: No recordings, transcripts, or server-side DLP/supervision, and certain anti-malware features are weakened.
  • Group vs. One-to-One: E2EE is supported only in specific one-to-one calls and Premium meetings; not available for group chats, channels, or shared files.

Security Posture and Strategy

  • Teams encryption is part of a broader Microsoft Zero Trust approach, with customizable policies via Entra ID (formerly Azure AD).
  • Customer Key (BYOK) enables organizations to maintain control over critical encryption keys.
  • Organizations should adopt a hybrid encryption strategy—using standard encryption for normal collaboration and reserving E2EE for sensitive cases.
  • A risk-based approach ensures compliance without undermining collaboration efficiency.

Quick Reference: Modalities and Encryption Support

Modality E2EE Available Standard Encryption
One-to-One Calls Yes (VoIP only) Yes
Scheduled Meetings Yes (Premium) Yes
Screen Sharing Yes (Premium/1-1) Yes
Video Yes (Premium/1-1) Yes
Group Calls No Yes
Channel Meetings No Yes
Chat Messages No Yes
Shared Files No Yes
Recordings No Yes

Implementation Notes

  • E2EE must be enabled by both IT admins and end users for one-to-one calls and premium meetings.
  • Admins can set policies organization-wide, leveraging Microsoft Purview Customer Key for advanced scenarios.

Learn More

  • [Overview of Customer Key - Microsoft Purview Microsoft Learn](https://learn.microsoft.com/en-us/purview/customer-key-overview)
  • [Overview of security and compliance – Microsoft Teams Microsoft Learn](https://learn.microsoft.com/en-us/microsoftteams/security-compliance-overview)

Conclusion

Microsoft Teams incorporates robust encryption technologies at every layer, supporting compliance and operational needs. By understanding and configuring standard and end-to-end encryption appropriately, organizations can secure their communications while continuing to leverage the collaboration tools Teams offers.

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