Microsoft Teams goes solo (in Europe)

Today: why Microsoft will no longer force European customers to buy Microsoft Teams along with Office, AWS makes a rare decision to kill a service, and this week's enterprise moves.

Microsoft Teams goes solo (in Europe)
Photo by Christian Lue / Unsplash

Welcome to Runtime! Today: why Microsoft will no longer force European customers to buy Microsoft Teams along with Office, AWS makes a rare decision to kill a service, and this week's enterprise moves.

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Separate ways

Microsoft Teams has been one of the company's most important priorities over the last several years, and it moved aggressively to get its customers up and running on the communication and productivity tool. Today it acknowledged that it might have gone a little too far.

Microsoft said Thursday it would offer customers in the European Economic Area and Switzerland the option of buying a Teams-less version of Office for a cheaper price, after the European Commission announced plans earlier this year to investigate complaints about Microsoft's strategy of bundling Teams with its very popular Office suite. It also said it would expand the integration capabilities in Microsoft 365 and Office to make it easier for other software developers to link their own apps.

  • European customers will still be able to buy a version of Office plus Teams, but those who just want the traditional Office package will now be able to save €2 per month per user.
  • Microsoft will also "create new support resources to better organize and point application developers to the existing and publicly available application programming interfaces (APIs) and extensibility in Microsoft 365 and Office 365 apps and services that connect with Teams," it said in its announcement.
  • And it will allow Teams competitors to work with Word and Excel files inside their own apps similar to how Teams handles those files.
  • "We also recognize that we are still in the early stages of the European Commission’s formal investigation," the company said, signaling that additional changes might be coming.

The concessions are a big win for Salesforce's Slack, which complained back in 2020 that Microsoft was "abusing its market dominance to extinguish competition in breach of European Union competition law" by bundling Teams with Office.

  • One thing to remember about Microsoft Teams was that it was a forced migration for enterprises that had relied on Microsoft's Skype for Business, which was a widely used business communications tool in Europe a decade ago.
  • It was also included with Office at launch, and Microsoft heavily incentivized its legions of partners to encourage their customers to use Teams.
  • But businesses that had relied on Office didn't necessarily want to use Teams, and Skype for Business users migrating to Teams didn't necessarily want to use Office.
  • Slack argued that Microsoft was running its old playbook by bundling a new product it wanted people to use with a widely used current product, and by making it harder to use alternatives with the widely used product.

So will Microsoft make a similar move in the U.S. and the rest of the world?

  • Google has already complained to U.S. regulators about how Microsoft uses pricing incentives to entice customers to run Microsoft software on Azure, so it's not hard to see longtime Microsoft rival Salesforce making a similar complaint on behalf of Slack against the Office/Teams bundle here.
  • However, stricter competition laws in Europe gave Microsoft less wiggle room than it enjoys in its home country.
  • At the very least, the changes allowing for greater interoperability with Office and Teams will benefit independent software developers around the world.
  • And if U.S. customers start to demand a Teams-less version of Office, it might make sense to meet them where they are rather than lose them to Google Workspace.

Killed by AWS

AWS has long had a reputation for keeping alive services that customers built applications around, unlike other cloud providers that occupied the spotlight this week. That means the most likely reason why it killed its Honeycode service this week is because nobody was actually using it.

Business Insider reported the imminent death of Honeycode a few weeks ago, and this week AWS confirmed that it would be going away next year. Honeycode was a so-called no-code tool, designed to let lay people build business applications without having to bother the IT department.

But the market for no-code tools has been iffy for some time, and the generative AI boom has sucked all the air out of the market for low-code tools, which are similar but still require some actual programming. DevClass spotted a few people on Reddit grumbling about the demise of Honeycode, but there was certainly no major outcry among tech buyers at this decision.

Enterprise moves

Douglas Brockett is the new executive chairman of Cynet, following his most recent role as president of Arcserve.

Peter Issacson is the new chief marketing officer at Invoca, following similar roles at Replicant and Demandbase.

The Runtime roundup

Signs of a rebound in enterprise tech spending continue to pile up, with Salesforce, Crowdstrike, Okta, Dell, and MongoDB all reporting stronger-than-expected earnings this week and in several cases increasing their guidance for the full year.

IBM signed a contract to provide facial-recognition technology to the U.K. government just a few years after promising it wouldn't work on those types of projects, according to The Verge.

Oracle and Microsoft's cloud services ran into some trouble in the Sydney, Australia area Thursday morning after a series of thunderstorms knocked out power across the region.

Malwarebytes laid off 100 employees just a few weeks after several top executives left the company, Techcrunch reported.

Juniper Networks told customers it had found several vulnerabilities in the software that controls some of its networking hardware products that could cause them to basically DDoS themselves.

Thanks for reading — Runtime will not be laboring for Labor Day weekend, see you Tuesday!

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