Microsoft has agreed to sell Office 365 suites without Teams at a significantly lower price than before, ending a five-year dispute with the European Union with a bang and avoiding an EU fine.
The software giant was accused of EU antitrust violations in June 2024 for bundling Teams with Office 365 and Microsoft 365 subscriptions. The dispute began in July 2020, when Slack (now owned by Salesforce) filed a formal complaint alleging that Microsoft was engaging in “illegal and anti-competitive practices that abuse its market dominance” by tying Teams “to its market-dominant office productivity suite,” according to a post on Slack’s news blog.
Microsoft must comply with the EU agreement for at least seven years or face penalties. EU competition chief Teresa Ribera said the deal “opens up competition in this crucial market and ensures that businesses are free to choose the communications and collaboration product that best suits their needs.”
Microsoft’s deal should result in significant cost savings for Office/Microsoft 365 customers. The price difference between suites with and without Teams will drop by another 50%. The price reduction will take place in the EU, but could potentially expand globally.
Other changes will include:
- Customers with long-term licenses can switch to licenses that do not include teams.
- Teams competitors (such as Slack, Google Meet and Zoom) will have compatibility with office software like Word and Excel.
- Customers can move their data from Teams if they want to switch to another communications platform.
The EU’s announcement “sends a clear message: Microsoft’s anti-competitive team-building has harmed businesses, denied customers a fair choice, and resulted in many years of lost competition,” Salesforce Chief Legal Officer Sebastian Niles said in a statement Friday.
Time will tell whether the EU-Microsoft deal significantly tips the scales toward and away from Teams. In 2024, Teams had five times as many monthly users as Slack and brought in $8 billion in revenue , about twice what Slack is forecasting for that year.
