EU to probe Microsoft's bundling of Teams with Office

Microsoft will face an official antitrust investigation by the European Union (EU) next week, it was reported on Monday, making for the software giant's first such probe in Brussels in 15 years.

According to the Financial Times, the investigation stemmed from allegations that Microsoft was unfairly tying its videoconferencing app Teams with its Office software.

The newspaper quoted sources familiar with the matter as saying the probe could result in formal charges as early as autumn, once the investigation was underway.

Microsoft previously announced in April that it would no longer impose the automatic installation of Teams on customers' devices.

That decision came after its workplace communications rival Slack filed a complaint in 2020, arguing that bundling the two services together violated EU competition laws.

However, negotiations between Microsoft and the European Commission hit a stumbling block over concerns about the geographical impact of the concessions, and the pricing of Teams to ensure fair competition.

Discussions to find alternatives to a formal investigation were taking place, the FT claimed, but it said it appeared unlikely that Microsoft would be able to avoid one.

Slack, which has been acquired by Salesforce since filing the complaint, urged EU regulators in it to prevent Microsoft from illegally leveraging its power by bundling or tying products across markets.

The investigation would be Microsoft's first competition probe in Brussels since 2008, when it faced accusations of abusing its dominant position by forcing users to download Internet Explorer, which was bundled with Windows.

While it did reach a settlement in that case, Microsoft was still fined €561m by the EU five years later for failing to uphold its commitment.

Reporting by Josh White for Sharecast.com.