The US Federal Trade Commission (FTC) has initiated an antitrust investigation into Microsoft, focusing on its practices in cloud computing, software licensing, cybersecurity, and artificial intelligence. This investigation arose after a year of informal discussions with various competitors and partners. The FTC has sent Microsoft a comprehensive request for information that covers multiple aspects of its operations.
The probe comes after concerns that Microsoft may be abusing its market position by implementing restrictive licensing terms. The FTC is particularly scrutinizing the company’s strategy of bundling productivity and security software with its cloud offerings. Critics argue that this practice could disadvantage competitors, especially in the realms of authentication and cybersecurity.
With Microsoft being a significant contractor for the federal government, including the Department of Defense, the investigation’s urgency is heightened by recent cybersecurity incidents linked to the company’s products. The FTC has highlighted the risks posed by a concentrated cloud market, noting that any service outages could have wide-ranging economic impacts.
In addition to the FTC’s scrutiny, Microsoft is also facing similar investigations in the UK, launched by the Competition and Markets Authority following complaints from Amazon Web Services regarding Microsoft’s alleged anti-competitive practices.
This investigation coincides with a crucial period for the FTC under Lina Khan’s leadership, known for its aggressive stance against corporate mergers and market consolidation. As Khan’s term might be nearing an end with the transition to a new presidential administration, questions loom over potential shifts in regulatory focus.
The current investigation echoes past antitrust actions against Microsoft, notably the landmark case from over two decades ago concerning the bundling of its operating system and web browser, which ultimately did not lead to a breakup of the company. The consequences of the FTC’s inquiry could greatly influence Microsoft’s market behaviors and the overall landscape of both the cloud and cybersecurity sectors.
