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Microsoft Offers to Unbundle Teams from Office to Address EU Antitrust Concerns

In a significant move to address growing regulatory pressure from European authorities, Microsoft has proposed to sell its Office 365 and Microsoft 365 productivity suites without bundling its popular Teams communication app. This proposal comes in response to mounting concerns over anticompetitive practices and follows a formal complaint lodged by rival Slack in 2020.

Responding to EU Scrutiny

The European Commission, the executive arm of the European Union, has been investigating Microsoft’s practice of tying Teams with Office, a strategy critics argue unfairly limits competition in the workplace communications market. Teams—integrated with Microsoft staples like Word, Excel, and Outlook—has seen a sharp rise in usage, especially during and after the pandemic, putting it in direct competition with apps like Slack and Zoom.

Under the proposed commitments, Microsoft will offer Office 365 and Microsoft 365 without Teams at a reduced price for customers in the European Economic Area (EEA) and Switzerland. Importantly, existing customers will be able to switch to versions without Teams, even in the middle of current contracts.

In addition to unbundling, Microsoft is also pledging to improve interoperability for Teams’ competitors. This includes offering better integration with Microsoft products and simplifying the process for customers to transfer their Teams data to alternative platforms.

Microsoft’s Statement

Nanna-Louise Linde, Vice President of European Government Affairs at Microsoft, emphasized the company’s collaborative approach with regulators:

“The proposed commitments are the result of constructive, good-faith discussions with the European Commission over several months. We believe that they represent a clear and complete resolution to the concerns raised by our competitors and will provide European customers with more choices.”

Reactions from Competitors

Slack, the workplace messaging app at the heart of the original complaint—and now part of Salesforce following its $27.7 billion acquisition in 2021—welcomed the move but remained cautious.

Sabastian Niles, President and Chief Legal Officer at Salesforce, responded:

“The European Commission’s announcement further affirms that Microsoft’s anticompetitive practices with Teams have harmed competition and require a binding, enforceable, and effective remedy. We will carefully scrutinize Microsoft’s proposed commitments.”

What’s Next?

The European Commission will now consult with third parties and evaluate Microsoft’s proposed remedies before making a final decision. Should the proposals be accepted, it could set a precedent for how big tech companies bundle and offer software products in the European market.

This move by Microsoft signals a broader shift in how tech giants approach compliance in global markets, especially as scrutiny around digital monopolies continues to intensify.