EU seeks feedback on Microsoft’s Teams offer

The European Commission has published Microsoft’s latest proposal to address antitrust concerns about integrating Microsoft Teams with MS 365 suites. The issue dates back to July 2023, when the Commission launched a formal investigation following complaints from Alfaview and Slack.

What is the issue?

Microsoft decided to bundle its Teams collaboration tool with its productivity suites, which was not welcomed by rival communication platforms. The Commission’s preliminary findings showed that Microsoft’s move to bundle the tool with its productivity suite abuses its dominance in the market and limits its competition with other collaboration tools, which is a breach of Article 102 of the Treaty on the Functioning of the European Union (‘TFEU’) and Article 54 of the Agreement on the European Economic Area (‘EEA Agreement’).

What are the proposed commitments by Microsoft?

To address these concerns, Microsoft has offered the following commitments:

• To offer customers purchasing in the EEA versions of its Office 365 and Microsoft 365 suites without Teams and do so at a lower price than the one for corresponding suites that include Teams. In addition, Microsoft committed not to offer discount rates on Teams or on suites including Teams higher than those offered for suites without Teams.
• To afford customers purchasing in the EEA recurrent opportunities to switch to suites without Teams and allow for such suites to be deployed in datacentres worldwide.
• To allow Teams’ competitors and certain third parties (i) access to and effective interoperability with identified Microsoft products and services for specific functionalities, as well as (ii) to embed Office Web Applications (Word, Excel, and PowerPoint) in their own products, and to (iii) prominently integrate their products in Microsoft’s core productivity applications.
• To allow customers in the EEA to extract their Teams messaging data for use in competing solutions.

Furthermore, the tech giant mentioned that if the commitments are accepted, it will apply the same unbundled offerings and pricing worldwide.

The article also mentioned,

The commitments offered by Microsoft would remain in force for seven years, except for interoperability and data portability obligations which would remain in force for ten years.

What’s next?

The Commission is open to feedback from all interested parties to submit their views within one month of publication of a summary of the proposed commitments in the EU’s Official Journal. If the market test shows that Microsoft’s commitments address the EU’s concerns, the Commission may make them legally binding. And, if the tech giant fails to follow through, the Commission can fine the company up to 10% of its global revenue, without any proof of rule-breaking.

If these commitments are accepted, Microsoft may avoid further penalties and continue providing productivity services in Europe.

What do you think about this? Share your thoughts in the comments section below.