[German]Microsoft is making a 180-degree turn and will no longer automatically bundle its Teams video conferencing and messaging app with its Microsoft 365 packages as an Office solution. That's reported be Financial Times. With this move, Redmond is trying to take a step towards the EU Competition Commission and hopes to prevent an official antitrust investigation by EU regulators.
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One of Microsoft's strategies is to bundle anything and everything into its products like Windows or Office 365 (now called Microsoft 365) and thus flatten the competition. Personally, I've been waiting for a while for Redmond to get its bones pulled by competition authorities regarding the integration of Edge or Teams into Windows. And the bundling of products also seems to be getting out of hand with Office 365. At the latest with the integration of Microsoft Teams, I felt that a limit had been crossed that had to trigger an action by the competition authorities.
For Microsoft, it feels like a game: By the time competition authorities, whether in Europe or the U.S., show their teeth, the market has long been in their pocket. Does the shark from the EU have teeth after all? The threats of competition authorities with regard to an antitrust investigation sometimes bring about a change – even at a company like Microsoft.
Teams bundling in Office could be stopped
Financial Times correspondent Javier Espinoza in Brussels reports that Microsoft wants to stop rolling out its MS Teams app as a video conferencing and messaging app with Microsoft Office (well, by now they've largely flattened the competition, companies are hanging on by a thread Teams-wise, there's no alternative). Javier Espinoza refers to two sources that are said to be involved with the decision.
The background to this is a complaint filed with the EU Competition Commission in 2020. This complaint was filed by Microsoft competitor Salesforce, now the provider of Slack, which sees itself disadvantaged by the bundling of Microsoft Teams with Office 365. I had briefly reported on these facts on July 23, 2020 in the German blog post Slack: EU-Wettbewerbsbeschwerde gegen Microsoft Teams.
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In the meantime, we are almost three years further on – according to my information, there is still no official investigation by the EU Competition Commission. The EU Competition Commission had only launched a preliminary investigation into the incident. On December 13, 2022, Reuters had already reported in the article Microsoft seeks to settle EU antitrust concerns over Teams -sources that Microsoft is seeking a settlement in the case in question with the EU Competition Commission to prevent formal competition investigations. This is a new strategy by Microsoft to resolve formal issues with regulators instead of fighting them out legally, as it used to do.
Now the FT.com writes that Microsoft has made a concession to the EU Commission to stop forcing Office 365 customers to also install the Teams video conferencing and messaging app on their systems via bundling. The goal is clearly to pre-empt the opening of an official investigation by the EU Competition Commission. Currently, the sources reported that in the future companies should have the choice to subscribe to Microsoft 365 (Office 365) with or without bundling MS Teams. However, according to FT.com, the technical implementation is still unclear, talks are ongoing, and a formal agreement is not yet certain.
The EU browser choice case
The FT.com mentions the browser selection window issue, which led to an EU fine for Microsoft. But the case is imho not comparable, see also my article links at the end of the post. Background: In 2008, the EU Competition Commission accused Microsoft of exploiting a dominant position when integrating the Internet Explorer browser into Windows. At that time, there was, as a requirement to Microsoft, the browser selection dialog in Windows (Google also had to do so later in Android).
When Microsoft provided Windows 7 Service Pack 1, this browser selection had then been "forgotten". This resulted in a ridiculous fine of 561 euros. In the meantime, Internet Explorer is history and Microsoft has been technically overtaken by the Chrome development. In the meantime, we are back to the point where Microsoft massively annoys people in Windows with advertisements for Office 365, Outlook, etc. and also harasses them when they try to download another browser in Edge and wants to discourage them from doing so. That's where Redmond needs a massive strike to stop this practice.
My 2 cents
At this point, two questions arise in my mind from my experience with Microsoft's practice: is someone trying to build up pressure with the EU Competition Commission, or "testing the waters" by leaking information to test reactions? And what's the point if something like this is somehow "voluntarily" worded in a diaper way. If in doubt, Microsoft could, after all, set the subscription prices for bundling Microsoft Teams into Microsoft 365 in such a way that customers can no longer avoid the "complete solution."
If the preliminary investigation has uncovered sufficient evidence of anti-competitive behavior, competition proceedings should be opened. The question remains as to how attractive the carrot is for the EU Competition Commission to avert proceedings.
Similar articles (some in German)
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Win 8.1: Die Browserauswahl und der verschwundene IE
Autsch! Microsoft darf 561 Mio Euro Strafe zahlen
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Android: Google offers European users the browser choice
