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EU slaps Microsoft with a $2.4bn penalty, separation of Teams and Office underway due to persistent antitrust litigation
Microsoft, currently embroiled in several antitrust lawsuits and already burdened with a $2.4 billion fine, could be facing additional sanctions. To prevent this, the company has made the decision to offer its Teams applications independent of its Office suite.
Microsoft has declared that it will globally offer its chat and video application Teams as a standalone product, independent of its Office suite. This decision arrives half a year following its separation of the two products in Europe to mitigate possible EU antitrust issues.
Since 2020, the European Commission has been probing into Microsoft's package deal of Office and Teams. This scrutiny was initiated based on a grievance filed by Slack, a rival workspace communication application under Salesforce's ownership.
The feature Teams, first introduced to Office 365 at no extra cost in 2017, saw a surge in popularity, especially during the pandemic, due to its video conferencing features that succeeded Skype for Business.
Critics claimed that packaging their products together gave Microsoft an unjust edge. As a result, Microsoft began offering Office and Teams as separate products in the EU and Switzerland on August 31 of the previous year.
Microsoft has chosen to expand its unbundling worldwide as a reaction to customer suggestions and to give global businesses more buying options, as per a company representative.
Microsoft is rolling out new business versions of Microsoft 365 and Office 365 worldwide that won't feature Teams. Besides, a separate Teams package for corporate clients will be accessible in areas excluding the European Economic Area (EEA) and Switzerland.
Starting from April 1, clients have the choice to either stick with their existing license agreements or transition to the new plans.
The price range for Office, excluding Teams, for new business clients will be from $7.75 to $54.75. On the other hand, Teams alone will have a price tag of $5.25. These prices can fluctuate based on the country and currency.
Despite Microsoft's attempts to alleviate antitrust worries, their actions might not be enough to dodge potential accusations from the EU. Competitors have raised issues regarding the costs and integration of their messaging services with Office Web Applications.
Microsoft, which has previously been hit with EUR 2.2 billion in EU anti-competition penalties in the last ten years for product bundling, could potentially be fined up to 10% of its worldwide yearly revenue if it is found to be in breach of antitrust laws.
(Incorporating information from various sources)
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