Microsoft agrees to stop bundling Teams with Office to avoid EU regulatory investigation

Microsoft will stop forcing customers of its popular Office software to also have its Teams video conferencing and messaging app automatically installed on their devices, in a move designed to prevent an official antitrust probe by EU regulators.

The US tech giant has made the concession to avoid a formal investigation, said two people with direct knowledge of the decision, following a 2020 complaint by rival Slack, which claimed Microsoft’s practice of bundling the two services together was anticompetitive.

These people said that, in future, when companies buy Office they can do it with or without Teams if they wished, but the mechanism on how to do this remains unclear.

The people stressed talks are still ongoing and a deal is not certain.

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The move is part of an effort by Microsoft to try to avoid what would be its first antitrust probe in more than a decade, having sought to avoid legal battles with the European Commission that have proved bruising in the past.

In 2008, the commission accused Microsoft of leveraging its dominant position to push users to download its Internet Explorer browser by bundling it with Windows at the expense of rivals. The company settled with the commission and offered users a choice of browsers, but in 2013 the EU fined the company €561 million for failing to honour the promise.

It remains unclear if the tech giant’s offer regarding Teams will be enough to appease concerns of regulators. Slack, which has since been acquired by Salesforce, has asked EU officials to force Microsoft to sell Teams separately from its Office software.

At the time, David Schellhase, general counsel at Slack, said: “We’re asking the EU to be a neutral referee, examine the facts and enforce the law.”

Slack’s complaint came as the shift to working from home was accelerating. Apps such as Teams and Slack exploded in use during the peak of the coronavirus pandemic, creating a multibillion-dollar opportunity, as users and companies increasingly adopt tools that allow for remote working.

Microsoft said: “We are mindful of our responsibilities in the EU as a major technology company. We continue to engage cooperatively with the commission in its investigation and are open to pragmatic solutions that address its concerns and serve customers well.”

The commission, the executive arm of the EU, did not immediately reply to a request for comment. – Copyright The Financial Times Limited 2023