Microsoft has decided to stop mandating Office users to install Teams, its video conferencing and messaging app, to avoid an antitrust probe by EU regulators following a complaint by rival Slack. The move aims to prevent anti-competitive practices and allow customers to purchase Office with or without Teams. However, talks are ongoing, and it remains unclear if regulators will be satisfied with this solution.
To prevent an official antitrust probe by EU regulators, Microsoft has decided to stop mandating customers of its Office software to install its Teams video conferencing and messaging app on their devices. Two sources with direct knowledge of the decision stated that Microsoft has made the concession after a 2020 complaint by rival company Slack, which claimed that Microsoft’s practice of bundling the two services together was anti-competitive.
In the future, customers will be able to purchase Office with or without Teams, but it remains unclear how this mechanism will work. Although talks are still ongoing, a deal is not guaranteed. This move is part of Microsoft’s effort to avoid its first antitrust probe in more than a decade, as it has previously sought to avoid legal battles with the European Commission. The company had been accused in 2008 of using its dominant position to push users to download its Internet Explorer browser by bundling it with Windows, and in 2013, it was fined €561mn for failing to honour its promise to offer users a choice of browsers. However, it remains unclear if Microsoft’s offer regarding Teams will satisfy regulators. Slack, which was acquired by Salesforce, had asked EU officials to force Microsoft to sell Teams separately from Office.
David Schellhase, general counsel at Slack, had said, “We’re asking the EU to be a neutral referee, examine the facts and enforce the law.” Slack’s complaint had come as the shift to working from home was accelerating, and apps such as Teams and Slack had exploded in use during the peak of the coronavirus pandemic. The widespread adoption of remote working during the pandemic has created a multibillion-dollar opportunity for companies offering tools that enable remote work.
Teams and Slack are among the most popular apps for remote working, and Microsoft’s decision to stop mandating Teams with Office is an effort to avoid anti-competitive practices that could lead to an antitrust investigation by EU regulators. Microsoft has stated that it is mindful of its responsibilities as a major technology company in the EU and is open to pragmatic solutions that address regulators’ concerns while serving customers well. The commission, the executive arm of the EU, has not yet commented on the matter. It remains to be seen whether Microsoft’s offer regarding Teams will be sufficient to appease the concerns of regulators or whether further action will be necessary to ensure fair competition in the market.
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