EU: Microsoft Potentially Facing Significant Antitrust Penalty for Alleged Abuses with "Teams" Service
Tech giant Microsoft could be hit with a hefty antitrust fine from Brussels, according to EU competition authorities. The proposed measures from Microsoft to separate their chat- and video-app "Teams" from the "Office" product family are not deemed sufficient. The EU Commission alleges a breach of EU antitrust regulations.
If the EU sticks to its guns, Microsoft could face fines amounting to ten percent of its annual earnings. In response to accusations made in April, Microsoft indicated that Teams would be sold independently of Office bundles on a global scale, rather than just in Europe as initially planned.
"The Commission views these adjustments as inadequate. Microsoft must take further steps to restore competition," the statement asserted. "Ensuring competition in telecommunications and collaboration applications is crucial, as innovation on these markets thrives," said EU Competition Commissioner Margrethe Vestager.
The EU initiated an investigation following a complaint from competitor Salesforce, owner of the messaging app "Slack." Teams first emerge as a free alternative to Skype Business with "Office 365" in 2017. During the COVID-19 pandemic, its popularity soared due to its video conferencing capabilities.
The bundled marketing of Teams with Office provides Microsoft with an sales edge, the Commission explained the basis for its criticism. Furthermore, there were issues with compatibility when customers used competing messaging systems with Microsoft programs. Microsoft CEO Brad Smith has expressed the company's readiness to address the concerns from Brussels.
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The EU Commission is pushing for more concessions from Microsoft, viewing their initial adjustments as inadequate to address antitrust concerns over Teams. Microsoft could potentially face a cartel fine from the EU, equivalent to ten percent of its annual earnings, if they fail to comply with the EU's demands for restoring competition in telecommunications and collaboration applications.
