- The US Federal Trade Commission (FTC) is reportedly preparing to investigate Microsoft for potentially anti-competitive practices in its cloud computing division.
- If it goes ahead, the investigation could lead to increased oversight of Microsoft’s cloud strategy.
What happened
The US Federal Trade Commission (FTC) is reportedly preparing to investigate Microsoft’s cloud computing business, as reported by multiple sources on Thursday (November 14). This move comes amid allegations of the company potentially abusing its market position in the cloud services sector.
The Financial Times first revealed that the FTC is focusing on Microsoft’s productivity software, Microsoft 365, amid claims that it effectively locks customers into using Microsoft’s Azure cloud services. Following this, The Washington Post reported that the agency plans to issue Microsoft requests for documents and records.
This investigation represents the latest regulatory scrutiny of big tech under FTC chair Lina Khan. Previously, the FTC challenged Microsoft over its $69 billion acquisition of video game publisher Activision Blizzard, one of the largest deals in tech history.
If the investigation proceeds, it could lead to stricter oversight of Microsoft’s cloud strategies, underscoring the FTC’s commitment to protecting competitive markets increasingly dominated by a few major players.
Neither the FTC nor Microsoft has commented publicly on the matter.
Also read: FTC eyes Microsoft’s cloud practices amid anti-trust scrutiny
Also read: FTC to probe Microsoft over cloud deals after antitrust complaints
What it’s important
This scrutiny is part of a broader wave of antitrust actions in the tech industry. For instance, the European Union recently fined Meta $797 million over unfair practices with Facebook Marketplace, emphasizing a global push to address monopolistic behaviors. Similarly, Amazon faces investigations for allegedly favoring its own products over third-party sellers, highlighting a systemic issue across big tech. If unchecked, such dominance could lead to higher costs, reduced innovation, and fewer choices for businesses and consumers.
Taking a negative stance on Microsoft’s alleged practices is justified due to their potential to stifle competition and harm smaller companies. Independent providers like Vultr, which focus on cost-effective and customizable cloud infrastructure, may lose market share if forced to navigate inflated software costs. Consumers, too, are affected, as fewer competitors mean reduced bargaining power and potentially higher prices for cloud and AI-driven services. While Microsoft’s innovations in AI have propelled the industry forward, regulatory oversight is crucial to ensure a level playing field and long-term sustainability of the market. Addressing these issues now is essential to prevent entrenched monopolies that could harm innovation and limit consumer choice in the future.
