Gregory Jones I'm quoting a Microsoft source:
«Microsoft Controlled» basically means “Not enabled” for EDU for now, it’s just not documented well. So yes, you need to create an update policy with “New Teams as default” or “Classic Teams as default” and assign that to users who’s going to use New Teams. That will light up the toggle to switch between new and classic and unblock them.
From my experience in an EDU tenant with a Microsoft controlled update policy, a user can install and run new Teams, but after a reboot, the will be blocked with a message that "Your admin has restricted access to the new Teams". Need to use an update policy to specific users or flip the global policy over to new Teams as the default. The intention has been to not force new Teams in the middle of a standard semester period and best governance for EDU to set pick your own date for enabling new Teams.