In a bold move to placate antitrust concerns, Microsoft has declared it will sever the Teams chat app from its two most prevalent software packages in Europe. The announcement comes in response to a European Union investigation into whether the tech behemoth violated antitrust laws by bundling Teams with Microsoft 365 and Office 365. Starting immediately, the company will begin removing Teams from these suites for business clientele within the European Economic Area and Switzerland. This action, set to take effect from October 1, will see the annual subscription cost drop to around $26, with Teams still available as a separate option at approximately $5 per month.
The reshuffle is a direct result of an ongoing investigation, initiated in July, which accused Microsoft of leveraging the bundling of the software packages as a means to strong-arm customers into using Teams over competing communication platforms. This was seen as a potential violation of competition laws, with critics suggesting that Microsoft was exploiting its substantial size and influence to edge out competition across Europe. The probe was triggered by a complaint from rival company Slack Technologies in July 2020, alleging that Microsoft was unlawfully tying Teams to its dominant business productivity suites.
Microsoft Decouples Teams from Popular Software Packages in Europe in Response to EU Probe
Microsoft has announced its plan to separate Teams from its two prominent software packages in Europe. This move is seen as a cooperative response to an ongoing European Union investigation into potential antitrust law violations by the tech behemoth.
Immediate Steps to Unbundle Teams
Microsoft will begin the process of extracting the Teams chat app from Microsoft 365 and Office 365 suites for corporate customers across the European Economic Area and Switzerland. This change is set to commence on October 1, with an annual subscription to cost around $26. Teams will continue to be available as a standalone option for about $5 per month.
Addressing Antitrust Concerns
This major move follows an EU investigation initiated in July asserting that Microsoft had packaged the two software solutions together to coerce customers into using Teams over its competitors. Previously, customers had no choice but to select a business suite with Teams included without any cost reduction, raising questions about Microsoft’s use of its immense size and reach to force out competition across Europe.
The investigation was triggered by a complaint from Slack Technologies in July 2020, accusing Microsoft of unlawfully tying Teams to its dominant business productivity suites. The probe has since pressured Microsoft to address compatibility concerns and enhance the interoperability of its software programs, particularly as remote communication tools like Teams have become crucial in the wake of the COVID-19 pandemic.
Microsoft’s Commitment to Competition
In response, Microsoft affirmed its ongoing efforts to provide modern work solutions and collaboration capabilities that have led to its global dominance in cloud-based computing. However, the company also acknowledged its duty as a leading technology provider to maintain a healthy competitive environment.
What’s Next?
In the upcoming months, Microsoft will decouple Teams from Microsoft 365 and Office 365 suites and sell these suites, sans Teams, at a lower price to core enterprise customers in the region. New corporate customers will still have the option to purchase Teams separately, while existing customers with a suite that includes Teams can choose to retain their current software or switch to a suite without Teams.
Microsoft also announced intentions to enhance third-party hosting of its Office web applications. This marks the first time competitors can leverage Microsoft’s functionalities instead of developing their own.
Takeaways
Microsoft’s decision to unbundle Teams from its popular software packages in Europe is a bold move that demonstrates the company’s willingness to adapt and cooperate under regulatory scrutiny. This could set a precedent for other tech giants facing similar probes. It also opens up more choices for businesses in terms of communication and collaboration tools, potentially fostering a more competitive market. Ultimately, this can only be beneficial for the customers, who will have access to an array of solutions at competitive prices. However, the impact on Microsoft’s market dominance remains to be seen, and the length of the antitrust probe will likely be influenced by the company’s cooperation level with the investigation.
