Microsoft slips unscathed through EU competition probe after promising to unbundle Teams

In a significant development, Microsoft has successfully navigated a substantial antitrust inquiry by the European Commission by pledging to separate its corporate messaging platform, Teams, from its productivity offerings. This decision comes as a relief for the tech giant, which faced the possibility of hefty fines that could have impacted its operations considerably. The European Commission announced on Friday that it accepted Microsoft's concessions, concluding a lengthy investigation that began in 2020, following complaints from competitors, notably the messaging app Slack. As part of the agreement, Microsoft will offer its Microsoft 365 and Office 365 packages without Teams for the next seven years at a reduced price, allowing customers the option to pay extra for the collaboration tool if they desire. Additionally, the Commission secured commitments from Microsoft to enhance interoperability by opening its APIs, which will allow integration with third-party messaging and collaboration applications. Companies will also have the ability to export their data from Teams for the next five years. The European regulators had accused Microsoft of violating competition laws by bundling Teams with its Office suite, thus giving the app an unfair competitive edge. The Commission's initial findings indicated that this bundling resulted in a significant advantage due to Teams' integration with other Microsoft applications such as Excel, Outlook, SharePoint, and Word. In response to the concerns raised, Microsoft had proposed a partial unbundling in April 2024, but the Commission deemed that further changes were necessary, leading to a revised plan in May 2025. This resolution marks a positive outcome for both Microsoft and the EU, circumventing potential legal disputes. By agreeing to these terms, Microsoft not only sidesteps potential sanctions but also a fine that could have reached 10% of its annual global revenue, a figure that could amount to billions, given the company's reported revenue of $245 billion last year. Following a market test earlier this year, the Commission noted that both Slack and Alfaview, who had previously raised complaints, have since withdrawn their allegations. Teresa Ribera, the European Commission's executive vice-president for Clean, Just and Competitive Transition, emphasized that this decision enforces Microsoft's commitments to eliminate tying practices that hinder competition. Ribera stated, 'Today’s decision therefore opens up competition in this crucial market, and ensures that businesses can freely choose the communication and collaboration product that best suits their needs.'