Microsoft is nearing a European Union antitrust investigation over its workspace platform Teams as its proposed competition remedies are found unsatisfactory according to reports, with Microsoft commenting on the matter to ERP Today.
The development follows a 2020 action by now Salesforce-owned workspace messaging app Slack, which filed a competition complaint against Microsoft over the firm’s addition of Teams to Office 365 in 2017 for no additional cost, a move which saw the app outpace Skype for Business.
In a follow-up to this dispute, Microsoft could soon face an EU antitrust probe – which investigates evidence or allegations of anti-competitive behavior by companies with impact in more than one EU country – after remedy discussions with the EU watchdog “appear to have hit a roadblock”, Reuters’ sources said.
A Microsoft spokesperson told ERP Today this afternoon: “We continue to engage cooperatively with the Commission in its investigation and are open to pragmatic solutions that address its concerns and serve customers well.”
According to Reuters’ sources, Microsoft entered talks with the European Commission last year in an attempt to avert an investigation and has also recently offered to reduce the price of its Office product without its Teams app.
However, The European Commission has been seeking a deeper price cut than that offered by Microsoft in a bid to help ensure a level playing field with rivals and give consumers more choice.
Microsoft allegedly risks a fine of up to ten percent of its global turnover if found in breach of EU antitrust rules, but it still has a chance of improving its remedy before an official investigation is open.
As part of its competition complaint, Salesforce said Microsoft had “tied its Teams product into its market-dominant Office productivity suite” and, therefore, “illegally [leveraging] its power from one market to another by bundling or tying products”.
Salesforce also detailed that Microsoft’s approach with Teams was illegal because of “force-installing it for millions, blocking its removal and hiding the true cost to enterprise customers” in a step that eliminates “healthy competition [which] drives innovation and creates the best products and the most choice for customers”.
Over the past decade, Microsoft has been fined $2.4bn by the European Commission for practices in breach of EU competition rules, including similar cases of bundling two or more products together.
