Microsoft to Unbundle Teams and Office Worldwide Amid Antitrust Scrutiny

Microsoft announced on Monday that it will offer its chat and video app Teams independently from its Office suite worldwide.

This decision comes six months after the company separated the two offerings in Europe, aiming to avoid potential antitrust penalties from the European Union.

The European Commission initiated an investigation into Microsoft’s bundling of Office and Teams following a complaint by Slack, a competing workspace messaging app owned by Salesforce, in 2020.

Teams, initially integrated into Office 365 in 2017 at no extra cost, replaced Skype for Business and gained popularity, especially during the pandemic, for its video conferencing capabilities.

Microsoft to Unbundle Teams and Office Worldwide Amid Antitrust Scrutiny
Standalone Teams offering introduced for Enterprise customers in non-EEA regions, providing flexibility in licensing options.

Critics argued that bundling the products provided Microsoft with an unfair advantage. Responding to this feedback, the company began selling Teams and Office separately in the EU and Switzerland on August 31st of the previous year.

A spokesperson from Microsoft stated, “To provide clarity for our customers, we are extending the measures implemented last year to separate Teams from M365 and O365 in the European Economic Area and Switzerland to customers worldwide.”

They added, “This action also addresses concerns raised by the European Commission by offering multinational corporations greater flexibility in standardizing their procurement processes across different regions.”

Microsoft announced in a blog post its introduction of a new range of commercial Microsoft 365 and Office 365 suites for regions beyond the European Economic Area (EEA) and Switzerland, which exclude Teams. Additionally, they introduced a standalone Teams offering for Enterprise customers in those regions.

Microsoft to Unbundle Teams and Office Worldwide Amid Antitrust Scrutiny
Pricing for Office without Teams ranges from $7.75 to $54.75 for new commercial customers; Teams Standalone is priced at $5.25. (Credits: Microsoft)

Starting April 1, customers have the option to maintain their current licensing agreement, renew, update, or transition to the new offerings.

For new commercial customers, Office suites without Teams are priced between $7.75 and $54.75, depending on the product, while Teams Standalone is priced at $5.25.

These figures may vary based on country and currency. Microsoft did not disclose pricing details for existing bundled products.

Despite this unbundling effort, Microsoft might still face EU antitrust charges in the coming months. Rivals criticize the pricing structure and question the compatibility of their messaging services with Office Web Applications within their offerings, according to sources.

With a history of incurring 2.2 billion euros ($2.4 billion) in EU antitrust fines over the past decade for bundling multiple products, Microsoft risks facing fines up to 10% of its global annual turnover if found guilty of antitrust violations.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
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