The EU executive announced on Friday that Microsoft will introduce new versions of its Office 365 and Microsoft 365 suites that exclude Teams, offering them at a lower price point. The move follows a multi-year investigation into whether bundling Teams with Microsoft’s productivity tools gave the U.S. tech giant an unfair advantage in the fast-growing market for workplace communication software.
Nanna-Louise Linde, Microsoft’s vice president for European government affairs, welcomed the outcome, saying the company valued its dialogue with regulators and was focused on “promptly and fully” implementing its new obligations.
The case stems from a 2020 complaint filed by Slack Technologies, now owned by Salesforce, which argued that Microsoft’s bundling strategy restricted competition. German rival Alfaview also lodged a similar complaint. After its probe, the Commission’s preliminary findings backed those concerns, concluding that Microsoft’s practices distorted the market for cloud-based communication and collaboration products.
In response, Microsoft had already begun offering Office without Teams in Europe. However, regulators found the changes inadequate, prompting the company to put forward further commitments, including pricing reforms and increased flexibility for customers.
The settlement allows Microsoft to sidestep a potentially hefty EU antitrust fine. Reports earlier this year suggested regulators were inclined to accept the company’s proposals, provided they effectively addressed market imbalances.
The decision marks a significant development in the EU’s broader scrutiny of Big Tech, which has faced increasing pressure to ensure fair competition in digital markets. For Microsoft, it clears a major regulatory hurdle while intensifying the competitive landscape for enterprise communication platforms where Slack, Zoom, Google Meet, and other rivals continue to battle for market share.