Microsoft, one of the world’s leading tech companies, is currently navigating a complex regulatory landscape. With its ambitious plans to acquire Activision Blizzard and the ongoing controversies surrounding its Teams application, the company is under the microscope of regulators across the globe.
Unlike other tech giants that are facing head-on confrontations with regulators, Microsoft has adopted a more conciliatory approach. The company has been proactive in offering solutions to regulators to address competition concerns, sometimes even before these issues escalate into full-blown investigations.
- August 2023: Microsoft’s recent move to unbundle its Teams collaboration app from other Office applications in the EU was an attempt to pre-empt an investigation by Brussels.
- July 2023: In a bid to secure approval for its $75 billion acquisition of Activision Blizzard in the UK, Microsoft proposed to sell its streaming rights for games outside the EU to Ubisoft. This move was aimed at alleviating concerns that Microsoft might monopolize the emerging cloud gaming market.
- 2019-2023: Microsoft’s cloud licensing practices have been a point of contention since 2019. The company has been accused of leveraging its software licenses to push customers towards its cloud services, sidelining competitors like Amazon and Google.
Zoom’s Stance on Microsoft Teams
Following the EU’s decision to force Microsoft to stop bundling Teams with Office, Zoom’s CEO, Eric Yuan, has suggested that the US Federal Trade Commission (FTC) might want to consider a similar move. Yuan’s remarks came in response to Microsoft’s unbundling of Teams in Europe, a decision that was influenced by a complaint from Slack, another competitor in the collaboration app space. Critics argue that Microsoft’s bundling strategy gave Teams an unfair advantage, leading to its current dominance in the market.
While some of Microsoft’s concessions appear straightforward, rivals argue that they are merely cosmetic. Critics believe that the company’s voluntary measures are half-hearted attempts to divert attention from more significant issues. For instance, while Microsoft’s offer to sell its cloud streaming rights to games seems like a significant concession, it doesn’t prevent the company from entering the cloud gaming market. Microsoft can still obtain a commercial license from Ubisoft and benefit as a wholesaler of cloud games.
Teams Controversy: Too Little, Too Late?
Microsoft’s decision to unbundle Teams from Office has been met with skepticism. The company first integrated Teams with Office nearly seven years ago, a move seen as a strategic play to outmaneuver Slack. With over 300 million monthly active users, Teams has already established its dominance. Critics argue that the unbundling comes too late to rectify the market imbalance.
Microsoft’s recent regulatory challenges underscore the broader issues facing Big Tech. As these companies continue to expand their reach, the need for robust regulatory oversight becomes even more critical. While Microsoft has made efforts to address some of the concerns, it remains to be seen whether these measures will satisfy regulators and competitors alike.