Microsoft Teams Bundling May Have Violated Antitrust Law, EU Says

Academic FX
June 25, 2024
11 mins

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The European Commission on Tuesday said Microsoft may have violated EU antitrust rules by bundling Teams with its other Office products, giving it an unfair advantage over competing services.
The Commission opened an antitrust investigation after receiving a pair of complaints from Teams competitors in July 2023.
The decision comes a day after the Commission also announced preliminary findings that Apple’s App Store policies may have violated the new Digital Markets Act.

The European Commission on Tuesday said Microsoft (MSFT) may have violated European Union (EU) antitrust rules by bundling Teams with its other Office products, giving it an unfair advantage over competing services.1

The news comes just a day after the Commission accused Apple (AAPL) of violating the Digital Markets Act (DMA), which went into effect earlier this year and was passed to curb the power of tech “gatekeepers” including Apple, Microsoft, Meta (META), Alphabet (GOOGL), Amazon (AMZN), and TikTok parent ByteDance. The Commission has opened investigations into a number of the companies over issues with consumer choice and data.

Bundling Teams May Have Given Microsoft 'Distribution Advantage'

The Commission said Tuesday that Microsoft’s practice of bundling Teams with other products in packages like Office 365, which includes popular programs like Microsoft Word and Excel, may have given Teams an unfair “distribution advantage” over similar workplace collaboration products.

Last year, Microsoft took action to start offering Teams as a standalone product companies could subscribe to without a larger bundle, but the Commission said Tuesday that it does not believe those changes went far enough. The company also made the move to unbundle Teams from the rest of the Office suite globally in April.

EU Opened Investigation After Receiving Complaints Last July

The Commission said it opened the investigation after receiving a pair of complaints in July 2023 from Slack Technologies, which is now owned by Salesforce (CRM), and alfaview GmbH.

Microsoft has officially been sent the Commission’s “statement of objections,” and now has the opportunity to review the issues raised, provide a written response, or request an oral hearing to provide the Commission with more information. The Commission said it doesn’t have a deadline for its investigation, and Microsoft could face “a fine of up to 10% of the company’s annual worldwide turnover” if the Teams-related conduct is found to be anticompetitive.

Microsoft shares, which are up nearly 19% so far this year through Monday’s closing level of $447.67, are little changed in premarket trading Tuesday.

Tags :

Government, Microsoft

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