Microsoft Unbundles Teams—Are Customers Better Off?

We got big news today from the world of enterprise software. Microsoft has decided to stop including its Teams feature, a rival to Slack and Zoom Video, by default in its Office suite of software services, at least for new customers. The software giant made this change in Europe last summer, after a regulatory inquiry in its Teams bundling practices began, and has now extended it globally. Perhaps the company was anticipating U.S. regulators jumping on the issue, given that Zoom Video CEO Eric Yuan last year called for the Federal Trade Commission to look into it. Still, the impact of the move isn’t exactly what you might expect. While existing Microsoft customers aren’t affected, new customers which also want Teams will have to pay more than they would have in the past. That’s progress?

Microsoft has knocked a little off the price of its software suites to reflect the dropping of Teams. But that price cut doesn’t offset what it’s charging separately for the Teams feature. To be fair, that means the Microsoft customers that prefer Slack or Zoom will see a small benefit. That certainly won’t hurt, but it’s doubtful it will do much to help, given that for any cost-conscious customer, Teams is still cheaper than either of those (unless you’re getting the free versions of either Zoom or Slack, which have limited features). The real beneficiary of this move seems to be Microsoft itself, which gets both potential regulatory goodwill that comes from unbundling and a revenue lift. It’s doubtful, then, that Yuan will be mollified.