The European Commission is seeking public feedback on commitments offered by Microsoft to address competition concerns. These concerns arise from Microsoft’s practice of bundling its communication tool, Teams, with its Office 365 and Microsoft 365 productivity suites.
Microsoft has proposed several commitments in response to these concerns. The company plans to offer versions of its suites without Teams at a reduced price and will allow customers to switch from existing contracts that include Teams. Additionally, Microsoft aims to enhance interoperability for competitors’ products and enable customers to transfer their data out of Teams.
The Commission’s investigation began in July 2023 after receiving complaints from Slack Technologies, Inc., now owned by Salesforce, Inc., and alfaview GmbH. The investigation found that Microsoft holds a dominant position in the Software-as-a-Service (SaaS) market for productivity applications and has been tying Teams with its core SaaS offerings since at least April 2019. This practice was deemed a potential breach of Article 102 of the Treaty on the Functioning of the European Union (TFEU).
In light of these findings, the Commission concluded that Microsoft’s changes were insufficient to alleviate competition concerns. As part of its commitments, Microsoft has agreed not to offer higher discount rates on Teams-inclusive suites compared to those without it. Furthermore, they plan to provide access for competitors’ products to integrate with Microsoft’s services.
These commitments are set for seven years but extend up to ten years for interoperability and data portability obligations. A monitoring trustee will oversee implementation and mediate disputes between third parties and Microsoft.
Interested parties have one month from the publication date in the EU’s Official Journal to submit their comments on these commitments. Should the market test confirm that these measures adequately address competition issues, they may become legally binding without concluding any infringement by Microsoft under EU antitrust rules.
If approved but later violated by Microsoft, fines could reach up to 10% of its worldwide turnover.
For further details or inquiries about this case, contact Thomas Regnier or Sara Simonini at the European Commission.
