By Foo Yun Chee and Makini Brice
BRUSSELS (Reuters) – Microsoft avoided a potentially hefty EU antitrust fine by promising reduced prices for Office products excluding its Teams app, a move on Friday that comes as Brussels increases scrutiny of U.S. tech giants.
The case was triggered by a 2020 complaint from Salesforce-owned Slack Technologies Inc to the European Commission, which accused Microsoft of bundling its chat and video app Teams with its Office product to gain an unfair advantage over rivals.
German rival alfaview filed a similar complaint in 2023.
Microsoft has agreed to widen the price gap by 50% between certain Microsoft 365 and Office 365 suites that exclude Teams and their equivalent versions that include Teams, including suites targeted at businesses, the EU competition enforcer said on Friday, confirming a Reuters story in May.
The price gap will range from 1 euro to 8 euros and remain in effect for seven years. The U.S. software giant also committed to enhancing interoperability to facilitate competition for a period of 10 years. Microsoft’s offer will be implemented globally.
European customers will also be able to export their Teams messaging data to rivals.
“Today’s decision therefore opens up competition in this crucial market, and ensures that businesses can freely choose the communication and collaboration product that best suits their needs,” EU antitrust chief Teresa Ribera said in a statement.
Ribera riled U.S. President Trump last week after she slapped a 2.95-billion-euro ($3.5 billion) fine on Alphabet’s Google over its adtech practices, which he said was unfair and discriminatory, adding that the U.S. may retaliate with more tariffs.
Nanna-Louise Linde, a Microsoft vice president for European government affairs, said in a statement: “We appreciate the dialogue with the Commission that led to this agreement, and we turn now to implementing these new obligations promptly and fully.”
Alfaview Chief executive Niko Fostiropoulos said Microsoft’s remedies would boost Europe’s digital ambition.
“It sends an important signal for Europe’s digital sovereignty: fair market conditions not only promote technological diversity, but also secure the long-term innovative strength of the European market,” he said.
Salesforce also welcomed the concessions.
“This settlement is a meaningful step forward, and we applaud the Commission’s efforts to hold Microsoft accountable,” Sabastian Niles, Salesforce’s president and Chief Legal Officer, said.
“We look forward to the Commission’s rigorous monitoring and enforcement of the commitments to ensure Microsoft fully complies with its obligations,” he said.
Microsoft, which has been fined a total 2.2 billion euros in past years for bundling two or more products together and other marketing tactics, has taken a more conciliatory approach with EU antitrust regulators in recent years.
EU antitrust fines can be as much as 10% of a company’s global annual turnover.
($1 = 0.8535 euros)
(Reporting by Makini Brice and Foo Yun Chee; Editing by Benoit Van Overstraeten and Elaine Hardcastle)
