Microsoft to separate Teams from Office, tries to avoid EU antitrust fine

Microsoft has spun off its Teams chat and video app designed for offices to compete with other software products

BRUSSELS:

Microsoft said on Thursday it would unbundle its Teams chat and video app from its Office product and make it easier for rival products to work with its software, but rivals said it may have to do more to stave off a possible EU antitrust fine.

The proposed changes come a month after the European Commission launched an investigation into Microsoft’s links to Office and Teams following a complaint by rival Salesforce-owned workspace messaging app Slack in 2020. Microsoft’s moves announced Thursday were similar to tentative concessions that failed to address regulatory concerns. The EU’s competition watchdog said it took note of the company’s announcement and declined further comment.

The commission could formally charge the company in the fall if it does not raise its offer, people familiar with the matter told Reuters last month. 2017 saw the free addition of Teams to Office 365. With the help of its video conferencing, it gradually took the place of Skype for Business and grew in popularity throughout the pandemic.

“Today we are announcing proactive changes that we hope will begin to meaningfully address these concerns, even as the European Commission’s investigation continues and we are cooperating with it,” said Nanna-Louise Linde, vice president of Microsoft’s European government affairs. 

She said the changes seek to address two of the EU’s concerns, “that customers should be able to choose a business suite without Teams at a lower price than those that include Teams, and that we should do more to facilitate interoperability between competing solutions for communications and cooperation. and Microsoft 365 and Office 365”.

The changes effective from 1 October will apply in the EU and Switzerland.

Microsoft’s core enterprise customers, which represent the majority of the company’s commercial businesses in Europe, will be able to switch to a version of Office that excludes Teams at a price €2 per month cheaper than Teams. New business customers can buy Teams separately and separately for 5 euros per month. New support resources will be introduced to help customers and ISVs who want to remove data from Teams and use it in another product. Microsoft will also develop a new method for hosting Office web apps within competing apps and services similar to what it does with Teams. Slack owner Salesforce said he had nothing to add.

Rivals say Microsoft’s bid as it stands is unlikely to win over EU antitrust watchdogs.”This is pandering to the crowd. The Commission won’t likely enjoy it, in my opinion. Nothing incremental is included in the offer, according to a source in the market. The stakes are high for the U.S. tech giant, which racked up 2.2 billion euros ($2.40 billion) in EU antitrust fines in the previous decade for tying or tying two or more products together, but which has since sought a more conciliatory approach with regulators’ organs.

 

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