Microsoft is once again under the microscope, this time by the European Union (EU), for allegations of unfair bundling practices related to its Teams video conferencing application and Office software.
The impending investigation, anticipated to commence next week, is set to be the first against the tech behemoth in over a decade, further escalating tensions within the rapidly evolving digital landscape.
A bundle of troubles
Accusations have been mounting against Microsoft for its alleged abuse of its dominant market position. The impending investigation is poised to be the first in over a decade, reviving old tensions. Insiders claim that the EU could level formal charges against the company as early as fall this year.
The root of the problem lies in Microsoft’s bundling practices. It is alleged that the company forces Office customers to have Teams, its videoconferencing platform, automatically installed on their devices.
This issue was first brought to light by a complaint from Microsoft’s competitor, Slack, in 2020. It claimed that such bundling violated EU competition laws.
The company’s attempt to avoid a formal investigation by offering concessions was deemed insufficient by the EU. One of the sticking points in the negotiations was the geographical scope of the company’s concessions.
While the tech giant wanted to limit these to the EU, Brussels insisted on their worldwide application. Despite ongoing talks, it is currently seen as improbable for Microsoft to evade a full-scale investigation.
Microsoft’s antitrust woes amid tech titans’ scrutiny
This scrutiny of Microsoft comes as the company appears to be clearing regulatory hurdles over its contentious acquisition of Activision Blizzard, the gaming company.
The $75 billion deal, which had initially faced opposition from the US Federal Trade Commission and the UK’s Competition and Markets Authority, has now received approval from both.
While Microsoft has been navigating these waters, the EU has been tightening its grip on other tech giants as well. Companies like Apple, Google, and Meta are all under the EU’s antitrust lens.
However, the probe into Microsoft signifies the first such action since the tech giant was charged in 2009 with tying its Internet Explorer browser to its Windows operating system. This investigation brings an end to the prolonged truce between the tech titan and the EU’s competition watchdog.
Microsoft has been actively seeking to avoid legal altercations in Europe, a strategy that starkly contrasts with its more aggressive stance in previous competition complaints over two decades ago.
The company has reiterated its intent to work collaboratively with the EU in its investigation and remains open to practical solutions.
An intensifying call for Microsoft to make further concessions has been made by Stéphanie Yon-Courtin, a member of the European Parliament and former advisor to the French competition authority.
She stated that Microsoft’s market dominance has only grown since Slack’s original complaint, stressing the urgency for more progress in this case.
As we watch the impending investigation unfold, one thing is clear – Microsoft’s journey through this regulatory maze will set the tone for how global tech giants are scrutinized and regulated in an era where their reach and influence are continually expanding.
