Microsoft Adjusts Office 365 Suite Following EU Scrutiny and Competitor Complaints

Microsoft has announced changes to its Microsoft 365 and Office 365 subscription services, responding to pressure from the European Union and competitor grievances.

The alterations involve offering versions of these services that do not include Microsoft Teams, a widely-used collaboration tool.

The decision comes after Microsoft agreed to sell Office 365 suites without Teams in the EU and Switzerland last year, following concerns raised by the European Commission.

Microsoft aims to enhance clarity for customers with globally consistent licensing, simplifying decision-making processes.

Teams, introduced in 2016 as a complement to Office 365, has gained over 320 million users.

However, competitors like Slack have criticized Microsoft’s practice of bundling Teams with its Office 365 suite, alleging anticompetitive behaviour.

As part of the changes, Microsoft is introducing a standalone Teams option for enterprise customers outside the EU and Switzerland.

Existing customers have the flexibility to maintain their current bundled package or choose new options. New customers will have standalone pricing options for Teams starting at $5.25 per user per month.

Analysts believe these adjustments are unlikely to significantly impact Office 365 subscription growth. However, pricing changes may affect new customers opting for standalone Teams subscriptions, while existing customers retain flexibility.

While Microsoft aims to address regulatory concerns and competitive pressures, the broader implications of these changes remain uncertain.

The move highlights the challenges of navigating regulatory scrutiny and maintaining competitiveness in the tech industry.