The European Commission has informed Microsoft that its preliminary opinion is that Microsoft bundling Teams with the popular productivity applications in Office 365 violates the EU's antitrust rules. If the European Commission finds that Microsoft has violated antitrust rules, the US technology giant may face fines of up to 10% of its global annual revenue.
On June 25th, according to Caixin, the European Commission accused the U.S. technology giant of possible 'bundling sales' of Teams. Microsoft added the chat and video application Teams to the Office 365 suite in 2017 to make it a popular communication and collaboration tool among business users, which has caused dissatisfaction among competitors who believe that Microsoft's bundling of Teams with Office constitutes unfair competition. The European Commission's preliminary view is that Microsoft's bundling of Teams and popular productivity applications such as Word, PowerPoint, and Excel in Office 365 violates EU antitrust rules and restricts the communication and collaboration product market competition. If Microsoft is found to have violated antitrust rules, the company may face fines of up to 10% of its global annual revenue. Microsoft responded that the company will work to find a solution to address the remaining concerns of the European Commission. $Microsoft (MSFT.US)$The European Commission announced on its website on Tuesday, June 25th that it has issued a statement of objection to the U.S. technology giant, accusing it of possible 'bundling sales' of Teams.
According to reports, Microsoft added the chat and video application Teams to the Office 365 suite in 2017 to make it a popular communication and collaboration tool among business users. However, this has also caused dissatisfaction among competitors who believe that Microsoft's bundling of Teams with Office constitutes unfair competition. The European Commission's preliminary view is that Microsoft's bundling of Teams and popular productivity applications such as Word, PowerPoint, and Excel in Office 365 violates EU antitrust rules and restricts the communication and collaboration product market competition. Microsoft does not allow customers to exclude Teams when subscribing to Office 365, which may give Teams a distribution advantage. In addition, there are interoperability restrictions between Teams and products outside of Microsoft, which may exacerbate this advantage. The European Commission noted that these advantages of Teams will hinder competitors' innovation and harm the interests of customers in the European Economic Area. The European Commission has received complaints from Slack Technologies, Inc. (now a subsidiary of Salesforce) and alfaview GmbH. Microsoft announced in April of this year that it will split Teams from the Office suite for sale globally, allowing customers to purchase productivity packages without Teams at a lower price. The European Commission believes that Microsoft's changes may not be enough to solve the competition issue. If Microsoft is found to have violated antitrust rules, the company may face fines of up to 10% of its global annual revenue. However, the European Commission said that Microsoft has the opportunity to defend the company and can make commitments to address regulatory concerns and avoid potential fines.
Source: European Commission website
The European Commission has informed Microsoft that its preliminary view is that Microsoft's bundling of Teams and popular productivity applications such as Word, PowerPoint, and Excel in Office 365 violates EU antitrust rules.
The press release stated that the European Commission's preliminary view is that Microsoft dominates the global professional SaaS (software as a service) productivity application market, which makes the European Commission concerned that Microsoft's bundling of Teams with these software products restricts competition in the communication and collaboration product market.
The European Commission pointed out that Microsoft does not allow customers to exclude Teams when subscribing to Office 365, which may give Teams a distribution advantage. In addition, interoperability restrictions between Teams and products outside of Microsoft may exacerbate this advantage.
The European Commission mentioned that these advantages of Teams will hinder competitors' innovation and harm the interests of customers in the European Economic Area. The European Commission has received complaints from Slack Technologies, Inc. (now a subsidiary of Salesforce) and alfaview GmbH.
Microsoft announced in April of this year that it will split Teams from the Office suite for sale globally, allowing customers to purchase productivity packages without Teams at a lower price. The European Commission believes that Microsoft's changes may not be enough to solve the competition issue.
If Microsoft is found to have violated antitrust rules, the company may face fines of up to 10% of its global annual revenue. However, the European Commission said that Microsoft has the opportunity to defend the company and can make commitments to address regulatory concerns and avoid potential fines.
Microsoft President Brad Smith responded that the company will work to find a solution to address the remaining concerns of the European Commission.
Yesterday, the European Commission announced that it had preliminarily found that Apple's application store 'App Store' may violate the EU Digital Markets Act (DMA). The European Commission said that if Apple is ultimately found to be in violation, it may face fines of up to 10% of its global annual revenue. $Apple (AAPL.US)$In addition to Microsoft and Apple, subsidiaries of Alphabet, Inc., and Facebook's parent company, will also face regulatory scrutiny in the European Union.
Apart from Apple and Microsoft, Alphabet's and Facebook's parent company will also face the focus of EU regulatory agencies.$Alphabet-C (GOOG.US)$$Meta Platforms (META.US)$They will also face the focus of EU regulatory agencies.
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