Microsoft Teams and the European Commission Investigation: What’s changing and why?

September 1, 2023

In July of this year, the European Commission grabbed attention with a striking announcement: they initiated a formal investigation into Microsoft’s practice of bundling Microsoft Teams with Microsoft 365 and Office 365 suites for business customers. In response to this regulatory scrutiny, Microsoft announced significant changes yesterday.

Why these changes?

It all started with the European Commission, which expressed serious concerns about Microsoft’s dominance in the market. Two key issues were at the forefront:

Lack of Freedom of Choice: The Commission believed that business customers had the right to choose. They demanded that Microsoft provide customers with the freedom to opt for a business suite without Microsoft Teams at a lower cost.

Interoperability: There were also concerns about the limited interoperability between Microsoft’s products and competing solutions.

What will change?

Microsoft appears to be responding to the call for change, although these changes seem more aimed at demonstrating cooperation. The main changes are as follows:

Decoupling of Microsoft Teams: Starting October 1, 2023, Microsoft Teams will be decoupled from Microsoft 365 and Office 365 suites in the EEA and Switzerland. While this may create the impression of choice, Microsoft’s primary interest appears to be revenue retention. Existing business customers can choose to stick with their current suite or switch to a version without Teams. However, new subscribers will be forced to purchase two different SKUs to add Teams to their subscription.

Improved Interoperability: Despite Microsoft’s claims to enhance interoperability, these promises seem vague and often more focused on confusing customers than delivering real improvements.

Hosting of Office Web Applications: Microsoft will now allow third parties to host Office web applications. This could assist competitors but also appears to be a way to oversee and potentially benefit from competitive products.

What does this mean for customers?

These changes raise questions for Microsoft customers in the EEA and Switzerland:

Illusion of Freedom of Choice: Customers may feel that they now have choices, but the complexity of the new subscription system can be confusing and might compel customers to incur additional expenses.

Dubious Interoperability: The promise of improved interoperability seems more like a marketing ploy than a genuine improvement.

Promoting Competition or Control? Allowing third parties to host Office web applications may be seen as an attempt to maintain control over competing products rather than fostering real competition.

Independent Advice from BeSharp Experts

If your company wishes to understand the implications of these changes for your organization, why not seek independent advice? BeSharp Experts is ready to help you make informed decisions in these confusing times. Contact us for expert and impartial advice tailored to your specific situation. Let’s eliminate the uncertainty surrounding Microsoft together.