Microsoft to unbundle Teams from Office 365, Microsoft 365 amid EU probe

Aug. 31 (UPI) -- Microsoft announced it will unbundle Teams from its two most popular software packages in Europe in an effort to cooperate with a European Union probe into whether the global tech giant broke antitrust laws.

In a statement, Microsoft said it was immediately taking steps to remove the Teams chat app from Microsoft 365 and Office 365 suites for business customers throughout the European Economic Area and Switzerland.

The change will take effect beginning Oct. 1, with an annual subscription costing about $26, the company said. Teams will still be available as a standalone option for about $5 a month.

The shakeup comes as the investigation, launched in July, alleged the company had bundled the two software packages as a way to bully its customers into using the Teams software over rival communication programs.

Under the company's previous terms, customers were not allowed to choose a business suite without Teams at a lower price than suites with Teams included, raising concerns that Microsoft was using its indomitable size and reach to drive out competition across Europe.

The probe emerged from a July 2020 complaint by rival Slack Technologies which alleged Microsoft was illegally tying Teams to its market-dominant business productivity suites.

The investigation put pressure on Microsoft to do more to address rising compatibility concerns and make its various software programs work together more efficiently as remote communication tools like Teams have become indispensable, especially after many businesses relied on the technology during the COVID-19 pandemic.

Last month, EU competition commissioner Margrethe Vestager said the investigation would seek to ensure the markets for products like Slack "remain competitive" and that companies "are free to choose the products that best meet their needs."

In Thursday's statement, Microsoft stood by its continuing efforts to provide modern-day work solutions and collaboration capabilities that in recent years have led to the company's global predominance in cloud-based computing.

But Microsoft said it also recognized its "responsibility as a major technology provider to support a healthy competitive environment."

"We appreciate the clarity that has emerged on several of the concerns from extensive and constructive discussions with the European Commission," the statement said. "With the benefit of this clarity, we believe it is important that we start to take meaningful steps to address those concerns. We do this not with the sense that this will necessarily resolve all concerns, whether from the Commission or our competitors, but we believe this is a constructive step that can start to lead to immediate and meaningful changes in the market."

In the coming months, Microsoft said it would unbundle Teams from Microsoft 365 and Office 365 suites and sell the offerings without Teams at a lower price to core enterprise customers in the region.

New enterprise customers will still be able to purchase Teams separately while existing enterprise customers who already have a suite with Teams can choose to stay with their current software or to move to a suite without Teams, the company said.

Small business and frontline workers who use the software will also have the ability to choose a "without-Teams" option for a lower price.

Microsoft said it planned to improve the interoperability of its Microsoft 365 and Office 365 suites to help companies like Zoom and Salesforce tailor the way they use the technology across Exchange, Outlook and Teams.

As part of the action plan, Microsoft said it would also provide better technical support to its customers and allow application developers with specific needs to make improvements to the software.

The company also announced its intention to enable third-party hosting of its Office web applications, marking the first time that competitors can utilize Microsoft's functions instead of developing their own.

"We believe these changes balance the interests of our competitors with those of European business customers, providing them with access to the best possible solutions at competitive prices," Microsoft said. "We also recognize that we are still in the early stages of the European Commission's formal investigation. We will continue to engage with the commission, listen to concerns in the marketplace, and remain open to exploring pragmatic solutions that benefit both customers and developers in Europe."

The length of the antitrust probe could be determined by a number of factors, including the complexity of the case and the extent to which Microsoft cooperates with the investigation.

Microsoft faces another antitrust complaint from Britain's Competition and Markets Authority, which was scrutinizing the company's $69 billion takeover of gaming titan Activision Blizzard.