A PYMNTS Company

Microsoft Unbundles Teams Globally Amid Heightened Antitrust Scrutiny

 |  April 1, 2024

Microsoft announced on Monday its decision to sell its chat and video app Teams separately from its Office product globally. This decision comes six months after the tech giant unbundled the two products in Europe, following pressure from regulators.

The European Commission has been investigating Microsoft’s tying of Office and Teams since a complaint was filed by Salesforce-owned competing workspace messaging app Slack in 2020, according to Reuters reports. Teams, initially integrated into Office 365 in 2017 at no extra charge, gained significant popularity during the pandemic, particularly for its video conferencing capabilities after replacing Skype for Business.

Critics argued that bundling the products together gave Microsoft an unfair advantage in the market. As a response, the company began selling the two products separately in the EU and Switzerland on October 1 last year.

In a statement, a Microsoft spokesperson said, “To ensure clarity for our customers, we are extending the steps we took last year to unbundle Teams from M365 and O365 in the European Economic Area and Switzerland to customers globally.” The move aims to address feedback from the European Commission and provide multinational companies with more purchasing flexibility across different regions.

Related: Microsoft Offers To Charge For Teams In EU To Appease Watchdog

According to Reuters, Microsoft revealed in a blog post that it would introduce a new lineup of commercial Microsoft 365 and Office 365 suites globally that exclude Teams, alongside a standalone Teams offering for Enterprise customers in regions outside the European Economic Area and Switzerland. These changes are set to take effect from April 1, allowing customers the option to continue with their current licensing deals, renew, update, or switch to the new offers.

For new commercial customers, prices for Office without Teams will range from $7.75 to $54.75 depending on the product, while the standalone Teams offering will cost $5.25. However, the actual figures may vary by country and currency, with Microsoft not disclosing prices for existing packaged products.

Despite these changes, Microsoft’s unbundling efforts may not fully alleviate EU antitrust concerns. Sources suggest that antitrust charges could still be forthcoming, particularly regarding the fees and the compatibility of rival messaging services with Office Web Applications.

As Microsoft moves forward with its new approach to licensing and product offerings, the tech industry will closely monitor the response from regulators and competitors alike, shaping the future landscape of digital communication and collaboration tools.

Source: Reuters