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Microsoft has announced that it will globally separate its Teams business messaging and video app from its Office software. This move comes after the company previously separated the two products in Europe to address concerns from competition watchdogs. Teams was originally added to Office in 2017 and the European Commission has been investigating the move following a complaint from rival Slack in 2020.
A Microsoft spokesperson stated that this separation is aimed at providing clarity for customers and offering multinational companies more flexibility in their purchasing decisions across different regions. Teams Standalone will now cost $5.25 (£4.20) for new customers. However, it remains to be seen whether this decision will be sufficient to avoid potential EU antitrust charges, given Microsoft’s history of facing fines for bundling products together.
Microsoft has a track record of antitrust fines in the EU, totaling billions of euros, for previous violations. The company risks facing fines of up to 10% of its global annual turnover if found guilty of antitrust breaches. In the late 1990s, the US Justice Department also sued Microsoft for anti-competitive practices related to the Windows platform.
After the split of Teams from Microsoft 365 and Office Suites in Europe last year, there was no significant change in the platform’s user base size. According to data from market intelligence firm Sensor Tower, monthly active users of the Microsoft Teams mobile app remained stable in the first quarter of 2024 compared to the previous quarter.
The move by Microsoft to separate Teams from Office is a positive step towards promoting fair competition and ensuring that customers have access to products that meet their specific needs without being forced into bundled packages.
Microsoft’s history of antitrust fines should serve as a reminder that bundling products together can lead to negative consequences for consumers and competitors alike.
As such, it is important for companies like Microsoft to approach product development with transparency and consideration for consumer needs rather than focusing on profit margins through bundling practices.
Overall, this separation by Microsoft is a step in the right direction towards promoting fair competition and ensuring that consumers have access to products that meet their specific needs without being forced into bundled packages.
