Microsoft Teams Gets Divorced (A Global Unbundling)

This Week in IT, I explore the changes Microsoft has announced to Teams and Office apps globally that it hopes might avoid a legal showdown with the EU. I look at how a previous antitrust battle changed the software landscape forever but why this one might not have much impact on the stronghold Microsoft Teams has on enterprise chat and collaboration.

Links and resources

• Microsoft to Unbundle Teams from its Office Suite Globally (petri.com)
• Realigning global licensing for Microsoft 365
• Exclusive: Microsoft to separate Teams and Office globally amid antitrust scrutiny | Reuters
• Slack Files EU Competition Complaint Against Microsoft | Slack

Transcript

This Week in IT, I look at the changes Microsoft has announced to Teams and Office apps globally that it hopes might avoid a legal showdown with the EU. I look at how a previous Microsoft antitrust battle changed the software landscape forever, but why this one might not have much of an impact on the stronghold that Microsoft Teams has over enterprise chat and collaboration. So stay tuned for all the details.

Hello and welcome to the show where I discuss everything connected to Microsoft 365, Azure and Windows. But before we get started today, I’ve got a quick favor to ask you. About 50% of the people who watched last week’s video weren’t subscribed to the channel. Now, as we go live today, we’re on about 3,780 subscribers and I’d really love it if we could push that up this week to over 3,800. So if you’d like to help us meet our goal, please subscribe to the channel and don’t forget to hit the bell notification to make sure you get notified on all the latest uploads.

Before we look at the changes that Microsoft announced this week, let’s have a little bit of the backstory behind all of this. Now, of course, this isn’t the first antitrust battle that Microsoft has had with either the EU or the Department of Justice in the States. Probably the most significant one that really changed the software landscape forever was the one that was started by the Department of Justice against Microsoft in 1998, basically accusing it of having a monopoly on certain kinds of software that it was bundling along with Windows, along with various other complaints that it had.

Now, that antitrust action was settled by Microsoft with the Department of Justice in 2001 and basically it agreed to unbundle Internet Explorer with Windows or to at least kind of untie it from the operating system so that it was possible to essentially uninstall it and have other browsers as the default browser. And that really changed everything and made other browsers.

Of course, now we have things like Chrome and Firefox and lots of other alternatives that are significantly more popular than Microsoft’s own browser, which is now Microsoft Edge. Now, this story is kind of repeating itself in a way, but instead of with Windows, it’s happening now with Microsoft 365.

So in 2020, Salesforce, who own Slack, they filed a complaint with the EU Commission against Microsoft saying that it basically had a monopoly by bundling its Teams application with Microsoft 365 and of course the Office apps that come with that. In October last year, Microsoft announced some new plans for the EU or the European Economic Area, if you like, and Switzerland, but it was introducing some new Microsoft 365 plans that will be available by default for all new subscribers that don’t include Teams.

So essentially now, since October last year, in the EU, you buy Microsoft 365, whichever plan you want. They’re pretty much the same as what they always were, but they don’t include Teams. And if you want to use Teams, you have to add Teams on as an extra product essentially. So what Microsoft announced this week is that it’s introducing those changes globally and it’s bringing a set of new subscription plans to users outside of the EEA that essentially mimic what we have in the European Union that you buy, Microsoft 365, but you have to add on Teams if you want that functionality. So for global customers, the standalone Teams subscription is called Microsoft Teams Enterprise and it costs $5.25 per user a month.

So if you’re already subscribed to Microsoft 365, you have the option to stay exactly where you are and you can just continue to renew your current plan that already includes Teams, or you can switch to one of the new plans if you choose to do that and then add Teams on. And those new plans are available starting April 1st, so they’re already available as this video goes live.

But new subscribers who are outside of the EEA and Switzerland will now only be offered the new plans. So you have to subscribe to Microsoft 365 and then if you want Teams, you add it on as the optional extra. So it’s interesting to note that while the names of these plans between the global options and the EEA Switzerland options are basically identical, although the name of the standalone Teams add-on is a little bit different, essentially these global plans are not available to customers whose tenants are located in EU data centers and vice versa.

EU customers can’t buy these new global plans, although they are essentially one and the same thing. Microsoft is just aligning all of these plans together between the EEA and what’s available globally. So Microsoft is doing all of this to, of course, preferably avoid any kind of antitrust action from the EU, but this might not go far enough. But what Microsoft will no doubt be hoping that it will at least soften the stance that the EU Commission has against Microsoft if it comes to any kind of ruling and that Microsoft needs to take action.

If this doesn’t go far enough, what does that mean for Microsoft? Could it mean that Microsoft would have to open up Microsoft 365 more so that competing products to Teams, things like Slack, could actually integrate with Microsoft 365 in the same way that Teams does? I don’t know, I think that would be rather complicated from a technical point of view, but it might be something that Microsoft is eventually forced to do, of course. Is this going to have a massive impact in terms of increasing adoption of Slack and other similar products?

I don’t think so, because at least in very large organizations,(…) Teams is so integrated into what everybody’s doing with the rest of Microsoft 365 OneDrive email,(…) SharePoint, of course, all the stuff with the Power Platform, all the workflows that are created there. But I don’t think that suddenly enterprises that are fully in, that have bought in completely to Microsoft 365 are going to say, “Okay, well, actually we prefer to use Slack now.” I don’t think that’s very likely to happen, but we’d have to see. But I think that Microsoft doesn’t really need to worry too much about losing market share, at least where Teams is concerned. So let’s see what happens, at least in the EU.

Maybe Microsoft will avoid a fine, and maybe the fine will be a little bit less considering these actions that Microsoft is showing that it’s prepared to be flexible with all of this. If you’re all in on Microsoft 365, would you prefer to use Slack instead of Teams? Do you think it’s even an option when you’re using Microsoft 365? Does it make any sense to go over to Slack? Maybe you prefer Slack so much that you just couldn’t wait to get rid of Teams.

Let me know what you think about it in the comments below. If you found this video useful, I’d really appreciate it if you gave it a thumbs up, because it helps to get the video seen by more people on YouTube and to grow the channel. On the subject of Copilot, I’m going to leave you with another video on the screen right now about the differences between Copilot Pro and Copilot for Microsoft 365. So do check that out. But that’s it from me for this week, and I’ll see you next time.