Microsoft will sell its video conferencing app Teams globally separately from its commercial Microsoft 365 and Office 365 suites starting as early as Monday, April 1.
The Teams product will be separated from Microsoft 365 and Office 365 in the European Economic Area and Switzerland on October 1, 2023. Microsoft is now spinning off Teams and Office internationally because doing so “can address the issue of feedback from the European Commission and provide multinational companies with greater flexibility in responding to feedback from the European Commission.” Microsoft said in a statement provided to TechRepublic that it “wants to standardize their procurement across regions.”
Additionally, “Globally consistent licensing helps ensure clarity for customers and simplifies decision-making and negotiations,” a Microsoft representative wrote in an April 1 blog post.
The fact that Microsoft is doing this internationally shows the impact EU antitrust regulations are having on the way multinationals do business around the world.
Why is Microsoft splitting up Teams and Office?
In August 2023, Microsoft published a blog explaining why Teams and the commercial Microsoft 365 and Office 365 suites would be decoupled in the EEA and Switzerland. The post said the European Commission asked the company to decouple the product to address two issues:
- Customers should be able to choose the Business Suite without Teams price lower than Those that comprise the team.
- Microsoft should do more to make interoperability between Microsoft 365 and Office 365 suites and their competitors easier.
The European Commission began investigating Teams in 2020 after Salesforce-owned rival Slack filed an antitrust complaint.
See: European Commission launches antitrust investigation into Alphabet, Apple and Meta in late March. (Technological Republic)
If Microsoft fails to unbundle its products in the European Economic Area, the tech giant could face fines from the European Commission. If other regions adopt an approach similar to that of the European Commission, extending the unbundling to international markets may be an attempt to cover one’s bases ahead of other antitrust cases that may arise in the future.
What does the Microsoft Teams and Office split mean for IT professionals?
The impact of this change on IT professionals may depend on whether they choose to keep or change their current business Microsoft 365 and Office 365 plans.
Christopher Trueman, senior principal analyst at Gartner, said most organizations are likely to keep their current plans, including Teams.
“This doesn’t really change the IT management of Teams unless they want to drop Teams for a specific subset of users at the next renewal,” he said. For example, some customers may want to remove Teams to save money, or may be looking for “the best solution from another provider,” such as Slack or WebEx.
But Trueman noted that Teams is popular and many organizations have institutional knowledge on how to use it.
Another possible impact of the European Commission’s dealings with Microsoft is that applications that previously could not interoperate with Microsoft Office may gain some interoperability. When the EEA and Switzerland announced their breakup, one of Microsoft’s moves was to support third-party solutions for hosting Office Web applications. However, Microsoft has yet to say whether this measure will extend to international spin-offs, and content from many other programs is already available in Office and vice versa.
How much does Microsoft Teams and Office cost?
After April 1, Office without Teams for business customers will cost from $7.75 to $54.75 per user per month, depending on the plan. By itself, Teams costs $5.25 per user per month for business customers.
Customers who have a licensing agreement with Microsoft can now keep that agreement or switch to the new bundle.
