Microsoft

EU Commission Investigates Microsoft Teams Over Antitrust Concerns

The European Commission has launched a formal antitrust investigation into Microsoft’s bundling of its collaboration platform, Microsoft Teams, with Office 365 and Microsoft 365.

The investigation follows a complaint filed by Slack in 2020, which accused Microsoft of unfairly tying Teams with its productivity suites, thereby restricting competition in communication and collaboration products within the European Economic Area (EEA).

EU’s Concerns

The European Commission is concerned that Microsoft may be “abusing and defending its market position” by not giving customers a choice on whether to include access to Teams when subscribing to its productivity suites.

This may grant Teams a “distribution advantage,” resulting in limited interoperability with competing tools and hampering suppliers of other communication and collaboration products, such as Slack, from competing on a level playing field.

Slack’s Complaint About Microsoft

Slack’s complaint, made public in July 2020, accused Microsoft of illegally tying Teams to its dominant Office productivity suite.

The company claimed that Microsoft’s actions resulted in force-installing Teams for millions of users, blocking its removal, and concealing its true cost to enterprise customers.

Microsoft

Response From Microsoft

In response to the investigation, Microsoft “acknowledged the Commission’s work and its own responsibilities and stated its commitment to cooperating with the investigation.”

However, at the time of Slack’s complaint, Microsoft emphasized that Teams has been widely embraced by the market, especially during the COVID-19 pandemic, driving increased uptake of video conferencing and digital communication tools.

Ex-ante Competition Regime

The EU’s new ex-ante competition regime under the DMA, which applies to the most powerful digital intermediaries, may also have an impact on Microsoft’s business.

The DMA puts upfront obligations and restrictions on designated gatekeepers’ core platform services, including limits on self-favoring practices like “bundling or tying.

Microsoft believes it meets the criteria to fall under the DMA regime.

The enforcement of the DMA is in the hands of the Commission, and once the deadline for compliance expires early next year, priority attention will be given to designated gatekeepers and core platform services.

The outcome of the investigation and potential application of the DMA’s regulations could influence Microsoft’s operations and its relationship with competitors.

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