The competition between Slack and Microsoft is taking an unprecedented turn today as Slack announced that it has filed a competition complaint against Microsoft with the European Commission. Slack CEO previously complained about Microsoft’s anticompetitive practices, even though he said back in May that Teams “is not a competitor.” Ironically, Slack bought a full page ad in the New York Times back in 2016 to welcome the new competition from Microsoft Teams.
In its complaint, Slack is arguing that Microsoft is back to its old ways of bundling its services to lock out competitors from the market, as it did before with its Internet Explorer browser. Microsoft Teams is indeed bundled with some Microsoft 365 commercial subscriptions, so customers already using the Microsoft cloud have a big incentive to use Teams instead of Slack or other enterprise communication apps.
“Microsoft is reverting to past behavior. They created a weak, copycat product and tied it to their dominant Office product, force installing it and blocking its removal, a carbon copy of their illegal behavior during the ‘browser wars.’ Slack is asking the European Commission to take swift action to ensure Microsoft cannot continue to illegally leverage its power from one market to another by bundling or tying products,” said David Schellhase, General Counsel at Slack.
Microsoft has yet to comment on Slack’s complaint, but the timing for today's announcement couldn’t be more ironic. If Microsoft is one of the few tech giants that managed to avoid regulatory scrutiny in recent years, The Information was reporting earlier this week that Microsoft President Brad Smith had recently met with the US House antitrust subcommittee to discuss topics such as Apple's arbitrary App Store approval processes. The CEOs for Apple, Amazon, Google, and Facebook will appear in an antitrust hearing next week, which will mark a new step in the House antitrust subcommittee investigations' on digital app stores.
Microsoft will also announce its FY2020 Q4 earnings later today, and we expect big numbers for Microsoft Teams. Following the worldwide covid-19 pandemic that forced many employees across the world to start working from home, Microsoft announced that Teams had crossed 75 million active users in April, up from 44 million in March. Microsoft Teams has remained one of Microsoft's fastest-growing enterprise apps since launch, but the app is now way ahead of Slack which announced 12 million daily active users back in October.