Microsoft (NASDAQ:MSFT) has made a strategic decision to globally sell its chat and video app, Teams, separately from its Office suite. This move comes after the tech giant unbundled Teams in Europe last year to steer clear of potential EU antitrust penalties. The European Union (EU) has been scrutinizing Microsoft’s practice of bundling Teams with Office suite following a complaint by Salesforce-owned (CRM) Slack in 2020, a rival workspace messaging app. Slack and others argue that pairing Office with Teams gives Microsoft an unfair competitive edge.
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Microsoft’s Response
In response to the increased scrutiny from the EU, Microsoft announced the launch of new Microsoft 365 and Office 365 suites that do not include Teams. These software offerings will be accessible outside the European Economic Area (EEA) and Switzerland. Additionally, a standalone Teams option tailored for Enterprises will be available in these regions. Starting April 1, customers can choose to stick with their current licensing arrangement, renew, switch, or upgrade to the new packages.
Should Microsoft be found guilty of antitrust violations, it could face fines up to 10% of its global annual turnover, as reported by Reuters. This highlights the importance of compliance with competition regulations in the tech industry.
Is Microsoft a Buy, Sell, or Hold?
Analysts remain bullish about MSFT stock with a Strong Buy consensus rating based on 32 Buys and one Hold and Sell each. Year-to-date, MSFT has gone up by more than 10% and the average MSFT price target of $468.86 implies an upside potential of 11.4% at current levels.
