Microsoft caves to antitrust pressure and unbundles Teams from its Office 365 package worldwide
What you need to know
Microsoft has unbundled Teams from Office 365 globally after Slack filed a complaint with the EU Commission, citing anti-competitive practices.
The company separated the services in the European Economic Area and Switzerland last year, but it seems it was enough for the competitors.
Teams will now be available for new customers only as a standalone app for $5.25, whereas Office packages without Teams will range between $7.75 and $54.75.
Microsoft Teams is arguably one of the best video conferencing and productivity apps, with over 320 million active monthly users as of December 2023. One of the main reasons it has been widely adopted across companies and organizations is because Microsoft bundles it with Microsoft Office.
But this doesn't seem to sit well with competitors in the same sphere, like Salesforce-owned Slack, which filed a complaint against Microsoft at the height of the COVID-19 pandemic, highlighting the bundling of both services as "anti-competitive practices."
Microsoft unbundled Teams from Office in the Economic Area and Switzerland on October 1, 2023. Now, the company has announced that it is unbundling Teams from Office worldwide (via Reuters).
According to a Microsoft spokesman while commenting on the matter:
"To ensure clarity for our customers, we are extending the steps we took last year to unbundle Teams from M365 and O365 in the European Economic Area and Switzerland to customers globally. Doing so also addresses feedback from the European Commission by providing multinational companies more flexibility when they want to standardise their purchasing across geographies."
Last December, the EU Commission issued Microsoft's competitors questionnaires to understand if the move to unbundle Microsoft Teams from Microsoft Office in the Economic Area and Switzerland addressed their concerns. While the EU's next move was left to speculation at the time, it's now apparent that Microsoft's competitors weren't satisfied by the unbundling of Teams from Office in the Economic Area and Switzerland.
What's next for Teams and Office?
Microsoft Teams will be unbundled from the Office service effective April 1, 2024. Existing customers will continue to enjoy their current licensing deal that bundles Teams with Office. They also have the option to renew the deal, update, or switch to new offers.
As for new customers, Teams will only be available as a standalone app for $5.25, while Office packages without Teams will range between $7.75 and $54.75.
According to Reuters' source, Microsoft unbundling Teams from its Office package might not be enough to get the anti-trust watchdog off its back. We'll keep a close eye on the situation as it unfolds and keep you updated.
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