Initial EU investigation finds Microsoft breaking antitrust laws

A preliminary investigation by European Union leaders found that Microsoft breached antitrust rules by lumping the communication platform Teams with the company’s other popular business suites. If the preliminary investigation proves substantial, the tech giant will face a penalty totaling up to 10 percent of its global annual revenue, which hit over $200 billion last fiscal year. The EU investigation began last year following a 2020 complaint from Slack, a Teams competitor in virtual collaboration.

How is Microsoft bundling its products illegal? Microsoft products like Office 365 and Microsoft 365 dominate the market of productivity applications, according to the European Commission, the EU’s executive branch. Microsoft lumping Teams together with popular suites unfairly restricts competition among other communication and collaboration products, the commission said. The company also potentially gave Teams an unfair distribution advantage by not letting customers opt out of receiving Teams when they subscribe to other applications, the commission said. Preserving competition for remote communication and collaboration tools fosters innovation, said EU executive vice president in charge of competition policy leader Margrethe Vestager. Microsoft now has the chance to respond to our concerns, she added.

How has Microsoft responded? Microsoft began axing Teams from Microsoft program bundles last year and has taken initial steps to improve Microsoft’s compatibility with non-Microsoft tools, company President Brad Smith said in a statement to WORLD. The company appreciates the EU’s clarity today and will continue working on solutions for the commission’s other concerns, he continued.

Has Slack said anything? Sabastian Niles, President and CLO of Slack’s parent company, Salesforce, described the commission’s concerns as a win for customer choice. Slack hopes the EU will find quick and lasting solutions to restore fair choice and competition in the digital ecosystem, he said. 

Dig deeper: Read my report on Open-AI President Sam Altman’s brief stint as Microsoft leader last year.