EU launches antitrust investigation into Microsoft Teams after Slack complaint
The European Commission today disclosed that it’s investigating Microsoft Corp. over the way it distributes Teams to customers.
Microsoft ships Teams with Microsoft 365, a product bundle that includes the Office productivity suite. The videoconferencing and messaging service was previously a part of Office 365, a predecessor to Microsoft 365 that included many of the same products. European Union antitrust officials believe that this product bundling may amount to a breach of the bloc’s competition laws.
In its announcement of the antitrust probe, the European Commission highlighted two specific areas of concern.
The first is that Microsoft doesn’t allow users to opt out of access to Teams when purchasing a Microsoft 365 subscription. This practice, officials believe, may have given Teams a “distribution advantage” over rivals. The EU is also concerned that Microsoft may have limited Microsoft 365’s interoperability with competing communications services.
“Remote communication and collaboration tools like Teams have become indispensable for many businesses in Europe,” said European Commission Executive Vice President Margrethe Vestager. “We must therefore ensure that the markets for these products remain competitive, and companies are free to choose the products that best meet their needs.”
Microsoft launched Teams in 2017, a year after executives reportedly floated and then scrapped a plan to buy rival Slack. By mid-2021, Teams’ monthly active installed base had grown to 250 million users. Microsoft disclosed in April that this number has since climbed to more than 300 million users.
The EU began scrutinizing Teams in 2020 after it received an antitrust complaint from Slack. In its complaint, then-publicly traded Slack accused Microsoft of “force installing” the service for millions of users and preventing those users from uninstalling it. The company further charged that Microsoft was hiding the cost of Teams from enterprise customers.
Last week, Germany-based videoconferencing provider Alfaview submitted a similar antitrust complaint. According to the Wall Street Journal, the company filed the complaint after Microsoft proposed making certain undisclosed changes in a bid to avoid an EU antitrust investigation. Those changes, Alfaview stated, had failed to address its concerns adequately.
Microsoft’s proposed commitments apparently also failed to impress EU regulators. In a statement, the European Commission told the Journal that it hasn’t received “any commitment proposal by Microsoft that would resolve our concerns.”
“We respect the European Commission’s work on this case and take our own responsibilities very seriously,” Microsoft said in a statement of its own. “We will continue to cooperate with the Commission and remain committed to finding solutions that will address its concerns.”
If the EU’s investigation finds that Microsoft breached competition law with Teams, the company may be ordered to change its business practices. Such an order might require it to unbundle Teams from Microsoft 365. In some cases, EU antitrust investigations can also lead to fines.
The last EU antitrust investigation that focused on Microsoft scrutinized its proposed acquisition of Activision Blizzard Inc. for $68.7 billion. In May, the bloc approved the transaction after the company made a series of commitments designed to address competition concerns. As part of those commitments, Microsoft will license Activision Blizzard’s video games to certain rivals for at least 10 years.
A message from John Furrier, co-founder of SiliconANGLE:
Your vote of support is important to us and it helps us keep the content FREE.
One click below supports our mission to provide free, deep, and relevant content.
Join the community that includes more than 15,000 #CubeAlumni experts, including Amazon.com CEO Andy Jassy, Dell Technologies founder and CEO Michael Dell, Intel CEO Pat Gelsinger, and many more luminaries and experts.