Is breaking up Big Tech really the magic bullet for startups?

livemint.com:

Microsoft is unbundling its video conferencing platform Teams from the Office suite after a European probe into anti-competitive practices. Bundling of apps is under regulatory scrutiny everywhere. But breaking up Big Tech might not be the magic bullet.

When the pandemic started in 2020, Microsoft included Teams in its Office suite. In July that year, Slack—a Salesforce-owned productivity app—filed a complaint in the European Union claiming Microsoft is using the market dominance of Office to out-muscle Slack. Through last year, EU regulators ruled that Microsoft is, indeed, guilty of abusing its market power.

With similar regulations increasing globally, including in India, Microsoft split Teams and Office to avoid further investigations. By the end of 2023, Teams had hit 320 million monthly active users, against Slack’s 79 million. India’s Competition Act, 2002 lays down guidelines on market abuse, covering Big Tech as well—as seen in the Competition Commission investigating Google with regard to its Play Store.

In March, the Committee on Digital Competition Law introduced the draft Digital Competition Bill, 2024—which targets Big Tech in terms of unbundling of apps, and dictates how apps can cross-share data. This will directly regulate issues such as the Teams-Office unbundling, which homegrown startups have been demanding for a while now. Google and its Play Store policies have come under direct attention of such laws.

Two groups will be impacted—users and small businesses. For users, unbundling could create silos of many apps, while firms may face regulatory confusion over exactly what would be defined as abuse of market power. Silos could obstruct fluid user interfaces.