Microsoft Teams decouples from Office 365 suite globally

Licenses everywhere can omit collaboration app thanks to EU regulators

For those not keen on Microsoft Teams, help is in hand – European Union requirements to unbundle the software from Office 365 will be implemented globally.

During the pandemic lockdowns, Microsoft hoped Teams would zoom past competing collaboration tools. But in 2020, Slack complained that bundling Teams into Office 365 licenses was unfair, leading to a European antitrust investigation.

After unbundling Teams last year for those in the European Union and Switzerland, on April 1 Microsoft made the same arrangement available everywhere – no joke.

"Globally consistent licensing helps ensure clarity for customers and streamline decision making and negotiations," Microsoft announced on Monday.

"To that end, we are now updating the way Microsoft 365, Office 365, and Teams are licensed outside of Europe in keeping with the recent changes in the EEA [European Economic Area]. Starting today, we are introducing 1) a new lineup of commercial Microsoft 365 and Office 365 suites that do not include Teams in regions outside the EEA and Switzerland, and 2) a new standalone Teams offering for Enterprise customers in those regions."

The move leaves users with the option to carry on as normal, remove Teams from licenses and enjoy a small discount, or buy it as a standalone product.

That appears to be good news for Slack, Zoom, and others that are looking to lure Microsoft customers to their own collaboration apps. However, Google told us last year that Microsoft's concession of unbundling Teams from Office 365 in the EEA was "too little, too late" as the tool had already amassed million of users.

The Coalition for Fair Software, a lobby group believed to be backed by Google and AWS, pointed out that the change made to Teams by Microsoft comes amid growing interest from competition regulators in the vendor's wider licensing policies with regard to Office 365 and Azure.

In a statement, executive director Ryan Triplette, said: "By simply extending the changes offered in Europe in August 2023, this announcement pays lip service to fair competition but leaves interoperability and licensing restrictions in place that prevent true customer choice. Despite the shortcomings of the terms, they demonstrate that Microsoft is capable of making changes when held accountable by regulators.

"Microsoft's restrictive software licensing practices extend well beyond Teams and are used to drive up costs and lock in customers to their products throughout the cloud stack, from Azure to security offerings. We urge all regulators, including the US Federal Trade Commission, to take action to address these practices and improve consumer choice."

In the case of Teams, it took an EU investigation to force Redmond into action. Now the rest of the world will enjoy the benefits of its action, even if calls for changes to Teams licensing were not called out as an issue elsewhere. ®

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