Slack accuses Microsoft of anticompetitive practices in EU complaint

July 22, 2020
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Slack accuses Microsoft of anticompetitive practices in EU complaint 1

Slack accuses Microsoft of anticompetitive practices in EU grievance

Stewart Butterfield, co-founder and CEO of Slack, waits to do a tv interview after ringing the opening bell the New York Inventory Trade in New York on June 20, 2019.

Drew Angerer | Getty Photos

Slack filed a grievance towards Microsoft with the European Fee alleging anticompetitive habits, the corporate stated on Wednesday. 

Slack alleges that Microsoft abused its market dominance to eradicate competitors for its Groups work communication product by tying it to its common Workplace productiveness suite. Slack claims that transfer meant hundreds of thousands had been pressured to put in the app with out the power to take away it. Slack runs a service that competes instantly with Microsoft Groups.

Slack’s inventory was down about 1% Wednesday morning and Microsoft’s was barely optimistic. Microsoft was not instantly out there to answer a request for remark. A spokesperson for the EU Competitors Fee confirmed it acquired the grievance and stated in an announcement, “We are going to assess it underneath our customary procedures.”

The grievance stems from earlier frustrations at Slack. CEO Stewart Butterfield instructed The Verge in an interview in Might, “Microsoft is probably unhealthily preoccupied with killing us, and Groups is the automobile to try this.” Nonetheless, Butterfield instructed CNBC earlier that month that “Groups will not be a competitor to Slack,” although a submitting with the Securities and Trade Fee names Microsoft as Slack’s “main competitor.”

Microsoft has appeared to fly underneath the radar of antitrust authorities lately after the landmark case towards the corporate introduced by states and the Justice Division across the flip of the century. In that case, U.S. officers accused Microsoft of sustaining a monopoly by bundling its browser, Web Explorer, to its Home windows working system. Prosecutors argued that this restricted {the marketplace} for competing browsers on the Microsoft-owned OS.

Slack’s grievance appears to echo elements of that earlier Microsoft case by claiming the corporate bundles its Groups product to its Workplace suite.

“Microsoft is reverting to previous habits,” Slack’s Common Counsel David Schellhase stated in an announcement within the press launch saying the grievance. “They created a weak, copycat product and tied it to their dominant Workplace product, drive putting in it and blocking its elimination, a carbon copy of their unlawful habits throughout the ‘browser wars.’ Slack is asking the European Fee to take swift motion to make sure Microsoft can’t proceed to illegally leverage its energy from one market to a different by bundling or tying merchandise.”

Slack’s transfer to file its grievance within the E.U. is telling. Although each corporations are primarily based within the U.S., Slack is undoubtedly conscious of the E.U.’s current historical past of aggressive antitrust enforcement underneath Competitors Commissioner Margrethe Vestager. Vestager has introduced report fines towards Google and has introduced or is reported to be investigating a number of different main U.S. tech corporations together with Amazon, Apple and Fb. 

Nonetheless, the grievance is prone to elevate questions amongst U.S. antitrust authorities, whose investigations of the tech trade have been among the many most carefully watched. Microsoft hasn’t utterly escaped scrutiny by U.S. officers, although it has actually seen much less consideration than lots of its friends. The Federal Commerce Fee’s Workplace of Coverage Planning included Microsoft in its overview of previous acquisitions within the tech trade, a challenge that isn’t a part of its enforcement arm however might dig up potential enforcement points.

That is breaking information. Please test again for updates.

-CNBC’s Steven Kopack contributed to this report.

WATCH: How US antitrust legislation works, and what it means for Large Tech

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