It has been nearly a year since the European Commission opened its investigation into Microsoft, and there is finally a preliminary finding.
The European Union’s executive body announced its view that the tech giant violated antitrust laws by tying Microsoft Teams to its Office 365 and Microsoft 365 business suites.
This investigation was initiated in 2020 following a complaint from Slack, now owned by Salesforce, which claimed that Microsoft’s bundling practices broke EU competition rules.
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According to the European Commission’s statement of objections, Microsoft’s unbundling of Teams for users in the European Union and Switzerland last October is deemed “insufficient.”
The Commission expressed concerns that Microsoft may have granted Teams a distribution advantage by not allowing customers to choose whether or not to acquire access to Teams when subscribing to their SaaS productivity applications.
This competitive edge is perceived to be exacerbated by interoperability limitations between Teams’ competitors and Microsoft’s offerings.
The preliminary findings suggest that Microsoft’s conduct may have prevented Teams’ rivals from competing and innovating, ultimately to the detriment of customers in the European Economic Area.
If the EU confirms its preliminary findings, Microsoft could face a fine of 10 per cent of its annual worldwide turnover.
In response to the Commission’s concerns, Brad Smith, vice chair and president of Microsoft, stated, “Having unbundled Teams and taken initial interoperability steps, we appreciate the additional clarity provided today and will work to find solutions to address the Commission’s remaining concerns.”
Following the unbundling in October, Microsoft announced this past April that Teams would be available separately from Microsoft 365 and Office 365 to customers worldwide, with current users also having the option to switch plans.
The European Commission’s statement of objections also notes a complaint by Alfaview, another video-conferencing software provider, which filed a similar grievance to Slack in July 2023.
The Commission has open proceedings based on that complaint as well. As this investigation progresses, the implications for Microsoft’s business practices and the competitive landscape in the video-conferencing market will be closely monitored.
