Zoom CEO Calls on FTC to Investigate Office/Teams Bundling Too

In the wake of Microsoft’s decision to unbundle Teams from its Microsoft/Office 365 subscriptions in Europe, the CEO of Zoom has publicly asked the U.S. Federal Trade Commission (FTC) to require the software giant to do the same in the United States.

“We have huge competitors, sometimes they bundle everything together,” Zoom CEO Eric Yuan said Tuesday during the Goldman Sachs Communacopia + Technology Conference, as quoted by Bloomberg. “No matter what, you’ve got to be fair.” When asked what he thought about Microsoft’s announcement that it would unbundle Teams but only in Europe, he replied, “You should ask this question to the FTC as well.”

As you may have seen, Microsoft last week said that it would unbundle its Teams collaboration solution from the Microsoft 365 and Office 365 subscriptions it sells in the European Economic Area and Switzerland and lower their prices by €2 per user per month. This concession is a response to an EU antitrust probe that came out of a formal complaint from Slack three years earlier.

But as I asked in Win-Win? (Premium), why wouldn’t Microsoft simply make this change everywhere in the world, including in the U.S.? If it’s fair for customers and competitors in Europe, surely it’s fair elsewhere too.

Zoom is apparently asking the same question. But the FTC has, of course, run into some roadblocks attempting to exert itself with Big Tech in recent months. Among its legal losses, it infamously took on Microsoft’s $68 billion acquisition of Activision Blizzard and lost big. Twice. Like the UK Competition and Markets Authority, as inept a regulatory body as exists in this world, the FTC simply doesn’t understand the role it plays in antitrust and it goes after the wrong targets.

But Microsoft and its bundling of Teams in Microsoft 365 may, in fact, be the right target. Back in July, I made the case that Slack and Teams in some ways aren’t even competing in the same markets, as Slack is a favorite among startups and small businesses, whereas Teams targets enterprises. That said, defining the market being abused is a key tenet of antitrust regulation, and the FTC could simply argue that these products address businesses, regardless of size.

Helping matters, the EU approved the Activision Blizzard acquisition that the FTC whiffed on, but it is very aggressively pursuing Microsoft for this bundling. For once, the FTC has a solid antitrust enforcement precedent from a respectable regulatory body to fall back on, unlike the clown car that is the CMA.