When I saw the news reports that Slack had filed a competition complaint against Microsoft in the European Union, I started having flashbacks. Those powerful memories from more than two decades ago became especially vivid when I read the company’s press release announcing the filing.
Slack didn’t provide a copy of its full letter to the EU, but I read the blog post laying out its complaint. And then I read it again, and my reaction both times was “Are you kidding?”
If you were around for United States v. Microsoft Corp., the landmark antitrust case that nearly split the company in two back at the end of the 20th Century, you probably felt that same rush of memories.
Just look at these allegations:
Microsoft has illegally tied its Teams product into its market-dominant Office productivity suite, force installing it for millions, blocking its removal, and hiding the true cost to enterprise customers.
Illegal tying, of course, was one of the core complaints in United States v. Microsoft. The U.S. Department of Justice and the state attorneys general who brought the case argued that Microsoft had illegally tied its Internet Explorer browser to its dominant Windows product. (It’s worth noting that this tying was only one of several anti-competitive behaviors alleged in the suit.)
And the part about blocking the ability to remove Teams is also a callback to one of the most notorious bits of testimony in that trial. Microsoft argued that removing Internet Explorer from Windows would break the operating system. To prove it, they delivered a browser-free version of Windows 95 that was “so broken its only feature was an error message.” And Microsoft executive Jim Allchin delivered cringeworthy testimony that didn’t help Microsoft’s case.
More on those charges in a minute, but first let’s focus on this doozy from Slack, which explicitly calls out the 1990s-era antitrust action:
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.
The notion that Teams is a “copycat product” deliberately aping Slack is, well, interesting. It sounds true on its surface. After all, Slack launched in 2013, and Microsoft didn’t announce Teams until 2016. But there’s a catch. Teams didn’t spring into existence from thin air. It was, rather, a replacement for Skype for Business (announced in 2014), which was a renaming of Lync (2010), which had succeeded Office Communicator, the client for the Office Communication Server product that went all the way back to 2005.
That’s a continuous line of enterprise communication products, all in the Office family, that offered voice calls, text chat, and live meetings, with links to OneNote, Outlook, and other Office apps. Teams took those same features and put them in a more modern, cross-platform interface. It also melded in features from SharePoint, OneDrive, and Outlook and, crucially, moved everything from on-premises servers to the cloud.
Given that 15-year unbroken history, it’s pretty hard to argue that Microsoft took an unrelated product (Teams) and tied it to Office 365. And as Judge Thomas Penfield Jackson noted in his judgment back in 2000, the “crucial requirement … for a finding of technological tying liability” is that the products be deemed “separate products.” Teams is clearly well integrated with the rest of Office 365, not bolted on the way Internet Explorer was to Windows 95.
This case isn’t being tried in United States Federal courts, of course, and that precedent on tying is probably why.
As for the rest of the invocations of Microsoft’s anti-competitive behavior in the 1990s, well, we truly live in different times.
I’m not a lawyer, and I therefore won’t attempt to write a legal brief here. But as someone who’s studied this subject for decades, I can make a solid argument that Slack’s comparisons to Microsoft’s behavior during the browser wars fly in the face of current facts.
Microsoft doesn’t have a monopoly in 2020 as they did in Windows in the 1990s. The illegal tying accusation was arguably the weakest part of the DOJ case, which focused more on what the judge called “exclusive dealing arrangements.”
In 1995, when Netscape’s browser was taking the world by storm, Microsoft had an indisputable monopoly on the means of access to the Internet. There were no mobile devices, and Apple’s Mac business was anemic (the company would rehire Steve Jobs in December 1996).
See also: Slack debuts Slack Connect for improved collaboration between businesses | Slack rolls out new tools, certification program for administrators | New in Microsoft Teams: Teams-Skype interoperability plus pop-out chat windows | Who will win the epic battle for online meeting hegemony?
As part of that Windows monopoly, Microsoft made life miserable for Netscape. They prohibited OEMs from putting icons for third-party software (like Netscape Navigator) on the Windows desktop, and they also cut deals with PC makers, software vendors, content providers, and Internet service providers to make Internet Explorer the default browser and to lock out Netscape.
And yet, as the judge noted, that anti-competitive behavior failed:
Microsoft’s multiple agreements with distributors did not ultimately deprive Netscape of the ability to have access to every PC user worldwide to offer an opportunity to install Navigator. Navigator can be downloaded from the Internet. It is available through myriad retail channels. It can (and has been) mailed directly to an unlimited number of households. How precisely it managed to do so is not shown by the evidence, but in 1998 alone, for example, Netscape was able to distribute 160 million copies of Navigator, contributing to an increase in its installed base from 15 million in 1996 to 33 million in December 1998.
A quarter-century later, it’s hard to argue that Microsoft can use its 2020 market power to damage Slack by “behavior that deprives customers of access to the tools and solutions they want.”
For starters, Microsoft has strong competition in the PC market from Apple. In fact, if you go to the official help pages for “the new Slack experience for desktop,” all the screenshots are from Macs. Slack doesn’t disclose detailed stats for its customer base, but I wouldn’t be surprised to learn that 50% of its desktop traffic comes from Macs.
And then there’s Slack on mobile devices, where Microsoft has no control whatsoever over the platform.
Running Windows 10? If you want Slack, go to the Microsoft Store, as I just did, and install the official Slack app. (It’s free.)
In short, Slack has many, many ways to get its product into the hands of customers and prospects. Far more than Netscape did 25 years ago. The fact that Teams is installed as one of several programs along with Microsoft 365 doesn’t prevent its customers from using Slack instead, any more than the presence of Word somehow prevents a Windows PC owner from using Google Docs.
Finally, the accusation that Microsoft uses some sort of evil magic to install Teams, thereby “blocking its removal,” is laughable. On Windows 10 PCs, there’s an Uninstall button exactly where you’d expect to find it in Settings. I just used that button to successfully remove the app from a Windows 10 virtual machine. On a Mac, you can drag the Teams package into the trash to remove it, just as you can with any other app.
Slack is banking on the fact that the EU has been aggressive with antitrust complaints in recent years. But the fact that European competition authorities have ruled in favor of other, credible antitrust claims does not mean that they will approve a laughable claim, which is what this one is. Most of Microsoft’s enterprise customers who have begun using Teams to enable work-from-home strategies during the pandemic are doing so not because they’re forced to do so, but because it works for them.
In other words, Microsoft’s behavior isn’t anti-competitive. Maybe it’s just a little too competitive.
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