Microsoft is facing charges from the European Commission for allegedly violating antitrust laws by including its Teams chat app in its Office 365 and Microsoft 365 subscriptions. This is the first time in 15 years that Microsoft has faced an antitrust charge in the EU. In the past, there have been cases involving the bundling of Windows Media Player and Internet Explorer.
Microsoft has been charged by the European Commission for antitrust violations. The tech giant is accused of unlawfully bundling its Teams chat app with its Office 365 and Microsoft 365 subscriptions. Many view this move as providing Teams with an unfair edge over rivals such as Slack and Zoom. Following a complaint from Slack in 2020, Microsoft is now facing charges of “illegally tying” Teams to its Office products. This alleged practice has made it challenging for users to remove Teams and has resulted in increased costs for enterprise customers.
The European Commission’s statement of objections raises concerns about Microsoft’s bundling practices and their impact on competition in the market for communication and collaboration tools. According to Margrethe Vestager, the head of competition policy in Europe, Microsoft’s conduct, if proven, would be in violation of EU competition rules. The Commission has expressed concern about the possibility that Microsoft may have provided Teams with an unfair advantage by not allowing customers to acquire access to Teams independently from their SaaS productivity applications.
Microsoft has made efforts to address these concerns by separating Teams from Office in Europe last year and globally separating Teams from Office 365. Unfortunately, these measures have proven ineffective in stopping the charges. Brad Smith, the President of Microsoft, expressed gratitude for the Commission’s additional clarity and assured that the company is actively seeking solutions to address the remaining concerns.
If Microsoft is found guilty of antitrust violations, it could potentially face a fine amounting to 10% of its annual worldwide turnover. The European Commission has the power to enforce changes in Microsoft’s software products through the imposition of remedies. Microsoft has encountered penalties in the past for similar issues. In 2004, the Commission required Microsoft to provide a version of Windows without Media Player included. Additionally, in 2009, Microsoft had to incorporate a browser ballot box into its Windows operating system.
Competitors like Slack and Alfaview have expressed their approval of the charges, stating that Microsoft’s bundling practices have had a negative impact on competition. Sabastian Niles, President and Chief Legal Officer of Salesforce, Slack’s parent company, expressed his satisfaction with the charges, emphasizing that they support customer choice and confirm the negative impact of Microsoft’s practices with Teams on competition. The Commission’s extensive examination of Slack’s complaint is viewed as a promising move towards reinstating a climate of unrestricted and equitable selection in the digital ecosystem.
The antitrust charges brought by the European Commission against Microsoft shed light on the persistent concerns surrounding the company’s bundling practices and their effects on competition. Microsoft is actively working to address these concerns, and the outcome of this case could have far-reaching implications for the tech industry and regulatory landscape in Europe.