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Microsoft Decouples Teams from Office Suite Globally Amid Antitrust Scrutiny

Published April 02, 2024
2 months ago

Microsoft Corporation has announced that it will be offering its popular collaboration platform, Teams, as a standalone product separate from the Office suite on a global scale. This critical strategic shift comes as a response to antitrust investigations and follows the company's earlier decision to unbundle Teams from Office in the European market.

After in-depth scrutiny by the European Commission launched due to a complaint by Slack, a workspace messaging competitor, Microsoft has sought to address these concerns by altering how it packages and sells its software. Teams, which was integrated into Office 365 in 2017 at no additional cost, became a vital communication tool during the pandemic, seeing soaring demand for its video conferencing features. This success, however, did not come without qualms from competitors who argued that bundling Teams with Office gave Microsoft an undue market advantage.

In an effort to reduce antitrust pressure, Microsoft commenced the sale of Teams and Office as separate entities within the European Economic Area and Switzerland starting August 31, last year. "To ensure clarity for our customers, we are extending the steps we took last year to unbundle Teams from Microsoft 365 and Office 365... to customers globally," remarked a spokesperson from Microsoft. This move aims to offer vital flexibility for multinational corporations to standardize their software suite choices across different regions.

Adding to its portfolio, Microsoft is introducing a range of Microsoft 365 and Office 365 commercial suites that will exclude Teams in places other than the EEA and Switzerland. This will be paired with a fresh standalone Teams product specifically for enterprise customers outside those regions.

Starting April 1, current Microsoft customers will have the option to maintain their existing licensing agreements, renew, update, or opt for the new bundles. In a notable shift for new commercial customers, the company has set the pricing for Office without Teams from $7.75 to $54.75, while the Teams Standalone version will be priced at $5.25. These prices will fluctuate according to the country and local currencies.

Despite these significant changes, there remain doubts as to whether this unbundling will avert EU antitrust charges, which are expected to materialize in the form of company charges in the months ahead. Competitors have raised concerns about the pricing levels and the interoperability of their messaging services with Office Web Applications, suggesting that Microsoft’s antitrust woes are far from resolved. Previously found guilty of antitrust violations in the EU, with fines summing up to €2.2 billion over the past decade, Microsoft could potentially face a fine of up to 10% of its global annual turnover if found in breach of antitrust regulations again.

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