Microsoft to separate Teams and Office globally amid antitrust scrutiny

Microsoft (NASDAQ: MSFT) announced on Monday that it will begin selling its chat and video app Teams separately from its Office product globally. This decision comes six months after the company took similar steps in Europe, aiming to avoid potential antitrust penalties from the European Union.

The European Commission has been investigating Microsoft’s practice of bundling Office and Teams together since a complaint filed by Slack, a competing workspace messaging app owned by Salesforce, in 2020. Teams, initially introduced to Office 365 for free in 2017, gained popularity during the pandemic for its video conferencing capabilities, replacing Skype for Business.

However, rivals argue that bundling these products provides Microsoft with an unfair advantage. In response to concerns raised by the European Commission, Microsoft began selling Office and Teams separately in the European Economic Area and Switzerland on October 1 of the previous year.

Now, Microsoft plans to extend this unbundling globally, offering a new lineup of commercial Microsoft 365 and Office 365 suites that exclude Teams outside the European Economic Area and Switzerland. Additionally, the company will introduce a standalone Teams offering for enterprise customers in those regions.

Starting April 1, customers will have the option to continue with their current licensing arrangements, renew, update, or switch to the new offers. For new commercial customers, Office without Teams will be available at prices ranging from $7.75 to $54.75, depending on the product, while standalone Teams will cost $5.25. Prices may vary by country and currency.

Despite Microsoft’s efforts to address concerns about bundling, the company may still face antitrust charges from the EU. Critics argue that the fees associated with using their messaging services with Office Web Applications in their own services are excessive, and there are doubts about the interoperability of these services.

Microsoft has a history of facing EU antitrust fines, totaling 2.2 billion euros ($2.4 billion) over the past decade for practices related to tying or bundling multiple products together. If found guilty of antitrust breaches, the company could face fines of up to 10% of its global annual turnover.