Microsoft's case with the EU over its bundling of Teams appears to be nearing the end of its years-long battle.
Although it has been a long time coming, with Microsoft having made changes as far back as 2023 to try to resolve the case, the latest development shows a concession that looks set to help it avoid a large antitrust fine.
The EU accepted Microsoft's plan to unbundle Teams from Office. This means Teams will now have to be sold separately from the Office 365 and Microsoft 365 licenses.
Beyond the unbundling, the ruling has competitors feeling optimistic, as the agreement also states Microsoft must do more to improve interoperability, opening the door for rivals.
The Terms of Microsoft Teams Unbundling
The impending agreement comes after a years-long battle in Europe with the EU.
The case stems from a 2020 complaint from Slack, claiming "Microsoft has illegally tied its Teams product into its market-dominant Office productivity suite, force installing it for millions, blocking its removal, and hiding the true cost to enterprise customers." The EU and Microsoft have since been locked in a back-and-forth.
Microsoft previously offered some modifications to its suite as a proposal to settle the case, including unbundling Teams from Office in an attempt to head off the antitrust probe shortly after it was opened by the EU two years ago. Yet the proposals did not satisfy the EU.
This is because Microsoft's plans for Teams-less pricing would have resulted in an overall higher price for the combination of suites and Teams when purchased together, rendering Europe’s ruling largely ineffective.
Now, the conditions of this deal stipulate that Microsoft must sell Teams-less packages for less to reflect the removal of its online collaboration software.
This latest concession represents progress in Microsoft’s efforts to work with regulators to end the case.
Microsoft's commitments agreed here could be in force for up to 10 years, with fines of up to 10% of annual global revenues should it fail to abide by them.
The Competitors' Edge
This latest proposal by Microsoft, which looks set to be approved, was first revealed in May.
In addition to the unbundling, Microsoft appears ready to open up some of the red tape to improve interoperability between its platform and competitors.
