Microsoft Faces EU Antitrust Probe Over Teams/Office 365 Bundling

The European Commission has opened today an antitrust investigation to determine if Microsoft bundling Microsoft Teams with its Office 365/Microsoft 365 commercial subscriptions is anti-competitive. The EU probe follows a 2020 antitrust complaint from Slack, which accused Microsoft of doing “a carbon copy of their illegal behavior during the ‘browser wars.’”

Microsoft Teams, which launched as a barebones Slack competitor back in 2017, experienced unprecedented growth during the pandemic. “They created a weak, copycat product and tied it to their dominant Office product, force installing it and blocking its removal,” Slack complained back in 2020.

Fast forward to 2023, the European Commission will now carry out an in-depth investigation to find out if Microsoft is actually giving Teams a “distribution advantage” by not giving customers the choice to not get the app when they subscribe to Office 365/Microsoft 365. “These practices may constitute anti-competitive tying or bundling and prevent suppliers of other communication and collaboration tools from competing, to the detriment of customers in the European Economic Area,” the EU Commission said today.

Back in April, the Financial Times reported that Microsoft had agreed to stop bundling Microsoft Teams with its Office suite to avoid an antitrust investigation in the EU. However, the publication reported at the time that the mechanism Microsoft would use to allow customers purchasing Office to get Teams or not was still unclear.

From Slack’s point of view, it’s quite obvious that organizations that already get Teams for “free” as part of their Office 365/Microsoft subscription have pretty much no incentive to pay for Slack or any other cloud-based collaboration tool. In recent years, Teams really became a core Microsoft 365 app with lots of synergies with the rest of the company’s productivity apps. A consumer version of Teams is also installed by default on Windows 11.

“We respect the European Commission’s work on this case and take our own responsibilities very seriously. We will continue to cooperate with the Commission and remain committed to finding solutions that will address its concerns,” a Microsoft spokesperson said today in reaction to this new EU antitrust probe.