European officials are investigating whether Microsoft’s practice of bundling its Teams software with Office 365 is anticompetitive, the European Commission said Thursday.
The EU probe follows a formal complaint by Microsoft’s rival, the Salesforce-owned Slack, in 2020, alleging that Microsoft has illegally circumvented competition.
By packaging Teams together with its “well-entrenched” productivity suite, including apps such as Word and Outlook, Microsoft could be effectively blocking customers from seeking out rival collaboration tools, the Commission said. Antitrust officials are also concerned about interoperability issues between Microsoft’s software and third-party products, it added.
“These practices may constitute anti-competitive tying or bundling and prevent suppliers of other communication and collaboration tools from competing,” the Commission said in a statement.
Microsoft said in a statement it is cooperating with the probe.
“We respect the European Commission’s work on this case and take our own responsibilities very seriously,” said a Microsoft spokesperson. “We will continue to cooperate with the Commission and remain committed to finding solutions that will address its concerns.”
In a press briefing Thursday, EU spokesperson Arianna Podesta told reporters that “at this stage, possible commitments [by Microsoft to resolve the concerns] are too early to be discussed. We first need to identify indeed if there is a breach of antitrust considerations.”
The in-depth investigation reflects rising EU antitrust scrutiny for Microsoft, which was last fined on a competition violation in 2013 for not honoring a commitment to give European consumers a choice in web browsers.
Slack’s initial EU complaint alleged that Microsoft forces Teams onto millions of customers, “blocking its removal, and hiding the true cost to enterprise customers.”
A Slack executive at the time argued that Microsoft sells a closed ecosystem of its own products, while Slack provides customers with more freedom to mix and match services.
“This is a proxy for two very different philosophies for the future of digital ecosystems, gateways versus gatekeepers,” said Slack’s VP of communications and policy, Jonathan Prince.