FTC Launches Antitrust Probe into Microsoft’s Cloud and Licensing Practices Amid Looming Leadership Change
1min read The U.S. Federal Trade Commission (FTC) has initiated a comprehensive antitrust investigation into Microsoft, primarily focusing on its software licensing and cloud computing offerings. This move, sanctioned by FTC Chair Lina Khan, is part of a broader scrutiny of major tech companies. Khan, recognized for her assertive stance against industry giants such as Meta and Amazon, has been a major force in challenging monopolistic practices.
Reports indicate that the FTC's investigation centers on allegations that Microsoft may have leveraged its dominance in productivity software through restrictive licensing terms, potentially limiting customers' ability to transition data freely from its Azure cloud platform to competitor services. The inquiry also encompasses Microsoft's practices related to cybersecurity and artificial intelligence products.
Several competitors, including Google and Amazon, have previously criticized Microsoft for purportedly locking customers into Azure. They argue that Microsoft's approach restricts competition in the cloud computing sector. NetChoice, a lobbying group representing these companies, has voiced concerns about Microsoft's licensing policies and the integration of AI tools into Office and Outlook, underscoring the potential impact of Microsoft's market power.
The FTC's request for extensive information from Microsoft signals the agency's intent to delve deeply into these issues. This move comes at a critical time, as FTC Chair Lina Khan is expected to step down in January. The impending transition to a new administration raises questions about the future direction of this investigation, particularly given the potential for a more business-friendly appointee under President Trump's incoming administration.
Antitrust experts remain watchful, as this investigation revisits concerns similar to those raised over 25 years ago when Microsoft was scrutinized for bundling Windows with its Internet Explorer browser. The FTC's current focus appears to be on whether Microsoft is bundling its popular productivity and security software with its cloud services in an anticompetitive manner.
Furthermore, incidents involving Microsoft's cybersecurity missteps and its role as a significant government contractor add a layer of complexity to the current regulatory review. This scrutiny highlights longstanding apprehensions about the concentrated nature of the cloud market, which the FTC has noted could have rippling effects on the economy in cases of disruption.
As the investigation progresses, industry observers are keenly monitoring how these proceedings will unfold and the broader implications for Microsoft's operational practices and the competitive landscape of the technology industry.