Microsoft has revealed plans to unbundle Teams from Office 365 in Europe following pressure from Slack and the European Union (EU).
Slack had accused Microsoft of anticompetitive behaviour because the vendor includes Teams in its subscriptions for free, rather than charging extra or giving enterprises the ability to buy Office 365 without Teams.
The EU’s investigation was confirmed in July after months of swirling rumours.
Microsoft’s new approach, which covers the European Economic Area (EEA) and Switzerland from October, will see Office 365 subscriptions reduced by €2 per user per month with Teams excluded. Enterprises will be able to buy Teams separately for €5 per user per month.
Existing businesses stay with their current package or move to the new model.
Microsoft said the changes are largely targeted at its “core enterprise customers”. Office 365 E1 E3 and E5 licences, along with Microsoft 365 E3 and E5 licences, will no longer be available in the specific regions.
Microsoft added that businesses looking at SMB-focused packages will also be given a “without-Teams option”. Full details of the changes are available here.
Speaking to UC Today about the news, Patrick Watson, Head of Research at Cavell, said: "In our enterprise research study, from 2022, 32 percent of organisations cited Teams’ position within Office 365 as their main reason for its selection as a collaboration tool.
"It almost seems strange to expect Microsoft not to use the strength and coverage of its wider portfolio to amplify Teams’ adoption and make it more attractive as a collaboration tool.
"However, the horse has already bolted. Teams has witnessed huge growth, assisted by the pandemic and enforced working from home, so it looks like it's too late for any other platform to catch up in terms of market reach.
"Slack needed this news three years ago."
Meanwhile, Microsoft MVP and Empowering.Cloud Co-Founder Tom Arbuthnot, said: "It is interesting to see Microsoft react so quickly to this investigation.
"For customers choosing not to use Teams a €2 PUPM price reduction will be appreciated, I'm sure.
"For new customers, I'm not sure they will appreciate being charged €5 PUPM for Teams, which is up €3 on the old bundle cost. Fortunately, it looks like existing customers can stick with the Teams bundle SKU if they prefer."
Playing Nicely With Others
Alongside the licensing changes, Microsoft revealed plans to appease its competitors. It said it will create "new mechanisms" that will let other vendors host Office web applications in their own apps, in much the same way it's possible to open Word documents in Teams,
Microsoft said that this is already possible, but it's "heard requests from competitors of Teams that they would like to rely on Microsoft’s functionality instead of building their own".
It also said it would build more resources to improve the interoperability services it offers but did not go into detail about what this would entail.
