Microsoft is being investigated by the Federal Trade Commission in a wide-ranging antitrust probe, making it the fifth Big Tech company to fall under such scrutiny in several years.
The agency is looking into Microsoft’s cloud and software licensing business, cybersecurity services, and AI offerings. Bloomberg first reported the news and The Verge confirmed the investigation with a person familiar with the matter, granted anonymity to speak to a confidential probe.
The demand for information that spans hundreds of pages and culminates over a year of informal discussions with Microsoft competitors and partners. One focus is on how Microsoft bundles productivity and security software with its Azure cloud, per the source. The FTC’s interest in Microsoft’s cloud business picked up in the wake of several security incidents impacting its products, particularly because Microsoft is a top supplier of software to US government agencies. The FTC and Microsoft both declined to comment.
The government Cyber Safety Review Board concluded earlier this year that “Microsoft’s security culture was inadequate and requires an overhaul, particularly in light of the company’s centrality in the technology ecosystem.” Soon after, CEO Satya Nadella issued a memo to employees saying, “If you’re faced with the tradeoff between security and another priority, your answer is clear: Do security.”
If the FTC brought a lawsuit against the company, it would put Microsoft back into a familiar position, if one from a bygone era. The company faced an anti-monopoly lawsuit from the Department of Justice in the late ‘90s over the bundling of its web browser and Windows operating system. But in recent years Microsoft has mostly escaped the kind of antitrust scrutiny applied to Amazon, Apple, Meta, and Google, each of which is fighting its own monopoly charges from the government.
Still, a Democratic majority on the FTC is set to change soon when President-elect Donald Trump is inaugurated in January. He will likely choose one of the agency’s current two Republican commissioners to serve as acting chair, and will ultimately get to nominate a new chair or commissioner to the agency who aligns with his viewpoints. It’s not out of the question they’d continue the probe, however — since Trump’s last DOJ and FTC respectively filed antitrust suits against Google and Meta.
