European Union regulators on Tuesday accused Microsoft of violating antitrust rules by bundling its Teams collaboration and video conferencing software with a suite of other productivity tools, giving it an unfair advantage over rivals.
Regulators said Microsoft's bundling of Teams with other well-established software tools in Office 365 and Microsoft 365, which includes programs such as Word, Excel, PowerPoint and Outlook, amounted to an illegal abuse of market dominance that rival companies like Zoom and Slack couldn't match. . Regulators saying Basically, companies had no choice but to adopt Teams if they wanted other software made by Microsoft.
The accusations are just the latest in a series of announcements made by the European Union in recent months in its effort to crack down on the world's largest tech platforms. On Monday, regulators accused Apple of violating competition rules over its App Store policies. amazon, Google, Meta, TikTok and x also face investigations related to their business practices and services.
The Microsoft case has its roots in the Covid-19 pandemic, when video conferencing and collaboration tools like Zoom, Slack and Teams became essential for remote workforces. In 2020, Slack, now owned by Salesforce, complained to regulators that Microsoft's bundling of Teams with other productivity software was anticompetitive, triggering the initial EU investigation.
EU regulators said Microsoft had an unfair “distribution advantage” by not giving customers the option to buy Teams when purchasing other software. Rival makers of video conferencing tools also face challenges getting their services to work with other Microsoft software, regulators said.
“The conduct may have prevented Teams' rivals from competing and in turn innovating, to the detriment of customers,” the European Commission, the executive branch of the European Union conducting the investigation, said in a statement.
The charges filed Tuesday are one step in a long process. Microsoft can now respond to the complaint, but if the two sides do not reach an agreement, the company could face a fine of up to 10 percent of its annual global revenue.
The case has parallels to antitrust charges brought decades ago by the U.S. Department of Justice against Microsoft for including Internet Explorer within its Windows operating system, a case that was eventually settled.
On Tuesday, Microsoft said it had taken steps to resolve the dispute. Last year, Microsoft agreed to sell Teams separately from Office products.
“Having unbundled Teams and taken initial interoperability steps, we appreciate the additional clarity provided today and will work to find solutions to address the commission's remaining concerns.” Brad Smith, president of Microsoft, said in a statement.
The European Commission said Microsoft's changes were “insufficient” and called for more changes to be made to “restore competition,” without specifying what those changes should be.