The Onset of the EU Investigation into Microsoft
The European Union's antitrust authorities are preparing to kickstart an investigation into Microsoft (NASDAQ: MSFT). The focus will be on whether the tech behemoth is unfairly packaging its Teams video conferencing application with its Office suite, as reported by the Financial Times.
Potential Consequences and Regulatory Concerns
Insiders suggest that the investigation could give way to formal charges as early as autumn. European Commission regulators, who govern the EU's executive body, have voiced concerns that Microsoft's efforts to address competition worries have been insufficient.
Historical Context: The Slack Complaint and Microsoft's Reaction
This issue traces back to July 2020, when messaging application Slack filed a complaint with the EU Commission. They argued that Microsoft was illegally tying its Teams product into its market-dominant Office productivity suite. It should be noted that other complaints, apart from Slack (now a Salesforce (NYSE: CRM) property), have also been filed against Microsoft in Brussels. In response, Microsoft reportedly agreed to stop auto-installing Teams for Office customers earlier this year.
The Stalemate in Microsoft-EU Talks
Recent discussions between Microsoft and EU officials have come to a standstill over two major concerns: the broader geographical impact of Microsoft's concessions and the price tag the company would attach to Teams.
Microsoft's Likely Investigation: A Look at Precedents
People in the know have stated that the chances of Microsoft evading an EU investigation are "very unlikely". If initiated, it would mark the first time since 2008 that EU officials have launched a probe into Microsoft's activities. Previously, the company faced scrutiny over the alleged tying of its Internet Explorer browser with its Windows operating system.
