The European Union has accused Microsoft of violating antitrust regulations by improperly integrating its Teams software with its Office productivity suite.
The European Commission, the EU’s executive body, issued a Statement of Objections to Microsoft.
It signals preliminary concerns the tech giant may have broken EU laws.
The statement detailed Microsoft is suspected of tying Teams to its widely-used Office 365 and Microsoft 365 business suites.
The commission is investigating whether this potentially stifled competition.
If the allegations are proved, the commission could prohibit such practices.
It could also impose fines of up to 10 percent of Microsoft’s global revenue.
In expectation of regulatory scrutiny, Microsoft had already separated Teams from its Microsoft 365 package, aiming to alleviate antitrust worries.
Despite these actions, the Commission criticized the measures as inadequate.
It has stressed the need for further changes to restore competitive conditions.
Brad Smith, Microsoft’s Vice Chair and President, said: “Having unbundled Teams and taken initial interoperability steps, we appreciate the additional clarity provided today.”
The commission is investigating whether the move potentially stifled competition
He acknowledged the Commission’s feedback as helpful in guiding Microsoft’s compliance efforts.
Microsoft’s stock showed no significant movement in premarket trading following the announcement.
The inquiry into Microsoft was initiated in July 2023.
It followed a complaint from Slack, owned by Salesforce and a competitor to Microsoft’s Teams.
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The probe focuses on practices dating back to 2019.
Five years ago, Microsoft allegedly bundled Teams with its other software offerings without offering customers the option to opt out.
The Commission is particularly concerned about the potential market advantage this gave Microsoft.
It highlights issues with interoperability—or the lack thereof—between Microsoft’s products and those of its competitors, which could hinder competition and innovation.
EU regulators emphasized the detrimental impact these practices could have on competition.
Limiting alternatives and stifling innovation in the market could potentially harm consumers across the European Economic Area.
