Zoom CEO Calls On Feds To Investigate Competitor Microsoft’s Teams Bundling

“We have huge competitors, sometimes they bundle everything together … No matter what, you’ve got to be fair,” Zoom CEO Eric Yuan said at the Goldman Sachs Communacopia + Technology Conference on Tuesday.

Zoom Video Communications CEO Eric Yuan said on Tuesday that the U.S. Federal Trade Commission should investigate Microsoft, arguably the Zoom’s most formidable rival in the videoconferencing market, for bundling Teams with its Office 365 suite of enterprise software tools.

“We have huge competitors, sometimes they bundle everything together … No matter what, you’ve got to be fair,” Yuan said at the Goldman Sachs Communacopia + Technology Conference, according to a report from Bloomberg.

Zoom, alongside Microsoft Teams and Cisco Webex, emerged as the big three frontrunners in the collaboration market in 2020 as the COVID-19 pandemic sent employees all over the globe to their home offices and the videoconferencing market soared. Zoom at the time was beating out its competitors in terms of monthly users, including Teams and Webex.

Zoom was the leader in worldwide videoconferencing market share with approximately 55 percent in 2022. The company was followed by Microsoft Teams and then Webex, according to Statista.com.

[Related: The 10 Hottest Collaboration Tools Of 2023 (So Far)]

Yuan’s comments come on the heels of Microsoft’s announcement last week that it would split off Teams from its popular Office software in Europe after the tech giant ran up against antitrust concerns.

Following his comments when asked about Microsoft, Yuan said the question should also be posed to the FTC.

Specifically, Microsoft said it would unbundle Teams from its Microsoft 365 and Office 365 suites in the European Economic Area (EEA) and Switzerland starting Oct. 1 as part of an effort to quell a formal European Commission investigation into whether the vendor breached competition rules.

The commission announced in July a formal investigation against Microsoft to see if it is “abusing and defending its market position in productivity software by restricting competition” and giving “Teams a distribution advantage by not giving customers the choice on whether or not to include access to that product when they subscribe to their productivity suites and may have limited the interoperability between its productivity suites and competing offerings.”

As part of Microsoft’s changes, the vendor said it will sell M365 and O365 without Teams at a lower price for core enterprise customers – which represent most Microsoft commercial customers in the area. The lower price is 2 euros ($2.15) less a month or 24 euros ($25.75) less a year.

Starting Oct. 1, standalone Teams will be available for 5 euros ($5.36) a month or 60 euros ($64.36) a year. Existing enterprise customers can keep their current package or move to a Teams-less M365 or O365 package. Also beginning Oct. 1, Microsoft will offer Teams-less E1, E3 and E5 packages ranging from 7.40 euros ($7.94) to 57.70 euros ($61.90).

Existing Frontline suite customers can keep their packages with new prices ranging from 2.10 euros ($2.25) to 7.50 euros ($8.05). New Frontline suite offerings without Teams coming in October range from 1.60 euros ($1.72) to 7 euros ($7.51).

M365 Business suite customers can keep their packages with new prices ranging from 5.60 euros ($6.01) to 20.60 euros ($22.10). New M365 Business suite offerings without Teams coming in October range from 4.60 euros ($4.93) to 18.60 euros ($19.95).

Other changes Microsoft is enacting to satisfy the European Commission include “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” and “a new method for hosting the Office web applications within competing apps and services much like Microsoft accomplishes in Teams,” according to the vendor.

In the U.S., Microsoft offers a standalone edition of the collaboration app called “Teams Essentials” for $4 a user a month. Restrictions on the offering include a 300-participant limit per meeting and 10 gigabytes (GB) of cloud storage, according to Microsoft.

Phil Walker, CEO of Manhattan Beach, Calif.-based Microsoft partner Network Solutions Provider told CRN that customers using a different collaboration tool instead of Teams while using other Microsoft productivity applications could miss out on analytics and insights.

“Teams talks to all your data creation tools – Word, Excel,” Walker said.

Digging deeper into one vendor’s product suite can help with cost control since the market has so many overlapping tools, he said. Customers might not need to add another vendor if their existing one has the tool they want.

Redmond, Washington-based Microsoft did not immediately respond to CRN’s request for comment from CRN before publication time.

Fellow Zoom video competitor Cisco, for its part, sells Webex as a subscription via partners that includes Webex Meetings, and Webex App. In addition, the vendor offers Webex Work bundle for SMB customers that includes the aforementioned features plus Webex Calling. Cisco customers can purchase Cisco offerings via an Enterprise Agreement (EA), which is one agreement that includes access to all the company’s software and services, such as networking infrastructure, applications infrastructure, security, and collaboration.

The statements from Zoom’s CEO on Tuesday follow a challenging year for the company. Zoom in February announced that it would be reducing its staff by 1,300 employees, or about 15 percent of its staff, CEO Eric Yuan revealed in an internal message to Zoom employees at the time. The company’s stock had been declining in early 2023 as employees around the globe returned to the office, at least part time, which drove down the need for remote working tools.

The San Jose, Calif.-based company in August announced that employees that live within a 50-mile radius of one of the videoconferencing giant’s offices.

The U.S. FTC in March issued a request for information regarding “the competitive dynamics of cloud computing, the extent to which certain segments of the economy are reliant on cloud service providers, and the security risks associated with the industry’s business practices.”