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    European Commission accuses Microsoft of breaching EU anti-trust laws

    The European Commission, based on its preliminary findings, has informed Microsoft that the company has violated EU antitrust rules by tying its communication and collaboration service, ‘Teams’, to its software suites, Office 365 and Microsoft 365. If found guilty, Microsoft could potentially be fined with up to 10% of its annual worldwide turnover.

    The investigation into Microsoft’s alleged anti-competitive practices was brought forward by Teams’ competitor Slack in 2023, in which it alleged that Microsoft illegally tied Teams to its ‘dominant productivity suites’ and had forced customers to install Teams as part of the Microsoft Office 365 bundle. The European Commission (EC) found that Microsoft has been tying Teams with its cloud-based productivity suites for business customers, or software as a service (‘SaaS’), like Office 365 and Microsoft 365 since at least April 2019. It also noted that their ‘SaaS’ applications are dominant in their field.

    The EC alleged that Microsoft may have granted Teams a distribution advantage by not giving customers the choice to opt out of Teams when they subscribe to their SaaS productivity applications. They also added that Microsoft may have received further advantage by limiting the interoperability of Teams with external SaaS productivity applications.

    Thus, the Commission observed that Microsoft restricted competition in the market for communication and collaboration products by leveraging its market position in productivity applications and preventing Teams’ rivals from competing and in turn innovating.

    It was also acknowledged that in 2023, Microsoft unbundled Teams, separately from Microsoft Office 365 in the European Economic Area (EEA) and Switzerland and subsequently worldwide, following the beginning of the investigation. However, according to the EC the changes are “insufficient to address its concerns and that more changes to Microsoft’s conduct are necessary to restore competition.”

    Microsoft now has the right to defend itself in front of the Commission. However, if the Commission finds enough evidence to indicate a breach in antitrust laws, the company may be asked to adopt certain remedies or be imposed with a fine of up to 10% of its annual worldwide turnover.

    Microsoft president Brad Smith in a statement to the Financial Times said,  “Having unbundled Teams and taken initial interoperability steps, we appreciate the additional clarity provided today and will work to find solutions to address the Commission’s remaining concerns.”

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    The post European Commission accuses Microsoft of breaching EU anti-trust laws appeared first on MEDIANAMA.

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