Multinational technology giant Microsoft has been seen repeating its past behaviour of coupling its Internet Explorer web browser with its Windows operating system. This was first exhibited in a 2009 court case, which was eventually settled, with Microsoft promising to increase access to rival platforms. However, the company was still fined €561 million ($732 million) in 2013 when EU regulators determined that it had not met its commitments. In the present situation, the business has been accused of unfairly tying its Teams collaboration app with its Office 365 suite. The accusation comes from a business communication platform named Slack, which filed an antitrust complaint against Microsoft Corporation in the European Union, arguing that the firm is forcing millions of customers to install Teams.
The force installation and blocking of the apps removal may prove to be an illegal and anti-competitive practice. This action potentially abuses Microsoft’s market dominance to extinguish competition in breach of European Union competition law.
Microsoft launched Teams three years ago, when the group collaboration application was made available to Office 365 subscribers. The programme has 75 million daily active users, an increase of 31 million in the past month. The augmentation of interest is in correlation with the lockdown of offices and corporate buildings, where colleagues are expected to communicate through virtual and digital applications due to Covid-19. Team’s popularity may also be supported by the fact it offers video conferencing options, which Slack does not currently propose. Consequently, this competitive dispute arises at a very significant period, impacting on Slack’s low market share with just 12 million users, according to its most recent stats from October 2019.
David Schellhase, general counsel at Slack, stated, “Slack is asking the European Commission to take swift action to ensure Microsoft cannot continue to illegally leverage its power from one market to another by bundling or tying products”.
He continued to add, “Slack simply wants fair competition and a level playing field. Healthy competition drives innovation and creates the best products and the most choice for customers.”
In a statement after the legal action was announced, Microsoft agreed to work with the European Union and commented that they are“looking forward to providing additional information to the European Commission and answering any questions they may have."
So ultimately, who is in the wrong? Competition and antitrust laws are implemented to ensure that dominant companies are not allowed to foreclose competition illegally. Under the EU’s rules, practice is highlighted in preserving and promoting fair competition. The European Commission monitors and investigates cases of anti-competition practices, mergers and state aid, to ensure there is a level playing field for businesses while guaranteeing choice and fair pricing for consumers. Fines are imposed on companies going against this practise as it leads to higher prices and less choice for consumers. Free competition is a key element of an open market economy. It encourages economic performance and offers consumers a broader range of better-quality products and services at more competitive prices.
Therefore, this battle between companies Microsoft and Slack may prove to oppose the EU regulations within the business field. With a marginally lower user base, Slack and other such companies are trying to compete in a challenging market, with repeated and potentially unjust actions from market leaders, such as Microsoft, demonstrating that authorities should be involved. Is it a recurring case of the company not adhering to rules, with its existing market power?
The European Commission is now reviewing the complaint and decide whether to investigate Microsoft’s allegedly illegal practices formally.