Microsoft offers EU concessions on Teams bundling, seeks to end antitrust case with global changes

Microsoft submitted a formal commitments package to the European Commission on Wednesday in Brussels, proposing deeper changes to how it sells and integrates Teams with Microsoft 365 and Office 365. The move comes as the Commission weighs penalties for alleged illegal tying, and it seeks to resolve a case that has shadowed the company since Slack’s 2020 complaint.

The proposal expands Microsoft’s 2024 global unbundling by making Teams a standalone default for enterprise and small business customers, with published interoperability and data portability interfaces for rivals such as Slack and Zoom under fair, reasonable, and non discriminatory terms. Microsoft also offered trustee oversight for five years and quarterly reporting to the Commission under Article 9 of Regulation 1/2003, according to people familiar with the filing.

Why it matters

EU penalties in competition cases can reach up to 10 percent of worldwide turnover, and up to 20 percent for repeat offenses. Microsoft reported 211.9 billion dollars in revenue in its 2023 fiscal year, which underscores the financial risk if the case proceeds to fines instead of commitments.

The Teams case is an early test of how Brussels will police software bundling after the Digital Markets Act came into force. The Commission opened a formal investigation in July 2023, and issued objections focused on tying and interoperability in 2024, following Slack’s allegation that Microsoft leveraged Office dominance to entrench Teams.

Background and next steps

Microsoft first unbundled Teams for customers in the European Economic Area in late 2023, then extended the change worldwide in April 2024 with separate suites and a Teams only plan. Slack’s owner Salesforce argued at the time that the measures did not go far enough without robust API access and pricing that reflects the standalone value of Teams.

The Commission is expected to market test Microsoft’s new package, inviting third party feedback for about one month before deciding whether to make the commitments legally binding. If accepted, the decision would close the case without a fine, but non compliance could still trigger penalties.

A binding settlement would set a template for large software vendors that bundle collaboration, communications, and now AI assistants inside productivity suites. It would also signal how competition authorities plan to shape interoperability in enterprise software as incumbents integrate generative AI into core subscriptions.