Microsoft’s recent decision to split its Teams app from the Office software globally has drawn attention from customers, competition watchdogs, and the European Commission. The move, aimed at ensuring clarity for customers and providing more flexibility for multinational companies, comes after facing a possible fine in Europe due to competition concerns. While Microsoft introduced Teams to Office in 2017, the decision to split the two products could have significant implications on both its user base and potential antitrust charges.
The European Commission has been investigating Microsoft’s move following a complaint from rival Slack in 2020. With a history of incurring antitrust fines for bundling products together, Microsoft’s decision to offer Teams Standalone at a cost of $5.25 for new customers aims to address concerns raised by the European Commission. However, it remains to be seen whether this action will be sufficient to avoid EU antitrust charges, which could result in fines up to 10% of Microsoft’s global annual turnover.
Microsoft’s split of Teams from Office reflects a broader trend in the technology industry towards increased scrutiny of antitrust practices. The company’s previous legal battles, including the US Justice Department’s lawsuit in 1998, highlight the ongoing challenges of maintaining market dominance while complying with competition regulations. By separating Teams from its software suites, Microsoft may be attempting to preempt potential antitrust issues and provide customers with more choice in selecting their preferred solutions.
Despite the split, data from market intelligence firm Sensor Tower suggests that the size of Microsoft Teams’ user base remained relatively unchanged after the separation in Europe. Monthly active users of the Teams mobile app reportedly saw little growth in the first three months of 2024 compared to the previous quarter. This data indicates that while Microsoft’s decision to split Teams and Office may impact its regulatory compliance and pricing strategy, the platform’s popularity among users has remained steady.
As Microsoft navigates the implications of splitting Teams and Office globally, customers, competitors, and regulatory authorities will be closely monitoring the outcomes. The tech giant’s ability to balance innovation, customer satisfaction, and compliance with antitrust regulations will likely shape its future decisions and relationships within the industry.
