The Federal Trade Commission has opened a wide-ranging antitrust investigation into Microsoft, including into its software licensing and cloud computing businesses, people familiar with the matter told Reuters on Wednesday.
Officials confirmed the investigation to NBC News.
The investigation was approved by FTC Chair Lina Khan, who is likely to resign in January. The outcome of the investigation remains up in the air with the election of Donald Trump as US president and expectations that he will appoint a Republican with a softer approach to business.
FTC says software giants are abusing their market power in productivity software by imposing punitive licensing conditions to prevent customers from moving data from their Azure cloud services to other competing platforms. Sources confirmed earlier this month that they are investigating the possible allegations.
The person said Wednesday that the FTC is also investigating practices related to cybersecurity and artificial intelligence products.
Microsoft declined to comment Wednesday.
Competitors have criticized Microsoft’s approach, saying it locks customers into its Azure cloud service. The FTC filed such complaints last year while investigating the cloud computing market.
NetChoice, a lobby group representing online companies such as Amazon and Google that compete with Microsoft in cloud computing, criticized Microsoft’s licensing policies and its integration of AI tools into Office and Outlook.
“Given that Microsoft is the world’s largest software company with leadership in productivity and operating system software, the scale and impact of its licensing decision is extraordinary,” the group said.
Google filed a complaint with the European Commission in September about Microsoft’s practices, forcing customers to pay a 400% price increase to keep Windows Server running on competing cloud computing operators and providing more limited security updates. He later said that he provided it.
Bloomberg reported early Wednesday that the FTC has asked Microsoft to provide extensive details.
The agency had already claimed jurisdiction to investigate Microsoft and OpenAI over competition in artificial intelligence, and had begun investigating Microsoft’s $650 million contract with AI startup Inflection AI. .
Microsoft has become somewhat of an exception in U.S. antitrust regulators’ recent campaign against anticompetitive practices at Big Tech companies.
Facebook owners Metaplatforms, Apple and Amazon.com have all been accused by the US of illegally maintaining monopolies.
Alphabet Inc.’s Google is facing two lawsuits, including one in which a judge found it illegally impeded competition among online search engines.
Microsoft CEO Satya Nadella testified at Google’s trial, saying the search giant uses exclusive deals with publishers to lock down content used to train artificial intelligence. .
It is unclear whether President Trump, whose first administration launched multiple Big Tech investigations, will soften his stance on Big Tech. Incoming Vice President J.D. Vance expressed concern about the power companies wield over public debate.
Still, Microsoft has benefited from President Trump’s policies in the past.
In 2019, the Department of Defense awarded Amazon a $10 billion cloud computing contract that was widely expected to be won by Amazon. Amazon later claimed that President Trump had put undue pressure on military officials to keep them away from contracts with the Amazon Web Services unit.
