{"id":1266,"date":"2026-06-01T13:57:56","date_gmt":"2026-06-01T13:57:56","guid":{"rendered":"https:\/\/silvybrand.com\/?p=1266"},"modified":"2026-06-01T13:57:56","modified_gmt":"2026-06-01T13:57:56","slug":"microsoft-ftc-antitrust-investigation-cloud-ai","status":"publish","type":"post","link":"https:\/\/silvybrand.com\/?p=1266","title":{"rendered":"Microsoft could be the next Big Tech antitrust target"},"content":{"rendered":"


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Over the past several years, Microsoft has largely managed to withstand populist calls to break up Big Tech while peers faced sweeping lawsuits. But a probe by the Federal Trade Commission suggests that grace period could be nearing an end.<\/p>\n<\/div>\n

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Earlier this year, Bloomberg<\/em> outlined<\/a> the contents of civil investigative demands (CIDs) \u2014 similar to a subpoena \u2014 the FTC sent to at least half a dozen companies that compete with Microsoft. New details obtained by The Verge<\/em> further reveal the FTC\u2019s interests, suggesting the agency is particularly concerned with potentially exclusionary behavior around Microsoft\u2019s Azure cloud services, as well as its role in the AI industry.<\/p>\n<\/div>\n

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There\u2019s no guarantee the investigation \u2014 which began under the Biden administration<\/a> in 2024 and continued under President Donald Trump<\/a> \u2014 will end in a legal complaint. After further investigative steps, FTC staff will choose whether to recommend filing one, and the agency\u2019s two commissioners will take a vote. Should they approve a lawsuit, however, Microsoft may find itself back in a hot seat it occupied more than two decades ago, when a court found it had an illegal PC operating system monopoly.<\/p>\n<\/div>\n

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The Verge<\/em> obtained previously unreported information about the letters from an industry source who reviewed them and was granted anonymity to speak on nonpublic information. The Verge<\/em> further verified the document. The questions show the FTC gathering information on industry practices and competitive stumbling blocks, asking about Microsoft\u2019s business agreements, licensing arrangements, and interoperability of its products. The documents generally span more than 15 pages and over 15 questions, often with extensive sub-parts.<\/p>\n<\/div>\n

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Do you have information about government investigations into Microsoft and Big Tech? Reach out securely and anonymously with tips from a non-work device to Lauren Feiner via Signal at laurenfeiner.64.<\/em><\/p>\n<\/div>\n<\/div>\n<\/div>\n

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The CIDs say the goal of the FTC probe is to determine if Microsoft has used unfair methods of competition in its cloud, software products, and related services in violation of the FTC Act, the source says. The FTC did not respond to a request for comment. Microsoft spokesperson Alex Haurek says that the company is \u201ccooperating fully with the FTC and believe our practices promote competition while delivering the innovative products our customers expect.\u201d<\/p>\n<\/div>\n

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Customers have complained<\/a> \u2014 often anonymously for fear of retaliation \u2014 that Microsoft\u2019s 2019 changes<\/a> to its licensing terms made it significantly more costly to run Windows software on infrastructure outside of Microsoft\u2019s Azure cloud. In 2023, Google responded to a broad FTC inquiry<\/a> about business practices in the cloud computing industry by accusing Microsoft<\/a> of using dominance in other areas to \u201cgive their own cloud products an unearned advantage\u201d and lock in consumers. Microsoft insists there\u2019s plenty of competition in the cloud sector, and Haurek pointed to Google as \u201ca clear example of that dynamic\u2014growing 63% year over year<\/a> and competing head-to-head with other major providers including AWS, the largest cloud provider.\u201d<\/p>\n<\/div>\n

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Microsoft\u2019s growth in cloud computing has helped push its valuation to historic highs<\/p>\n<\/div>\n<\/div>\n

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Shortly before the investigation was reported<\/a>, a 2024 ProPublica investigation<\/a> found that Microsoft used similar leveraging to gain a foothold across US government agencies after installing free cybersecurity upgrades that came with products that specifically ran on Azure, which would be strenuous to switch away from later on. (Government contracts and cybersecurity were not among the CID topics disclosed to The Verge<\/em>, and Haurek says Microsoft responded to the government\u2019s security requests at the time and that agencies were \u201cfree to engage with other vendors.\u201d)<\/p>\n<\/div>\n

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Microsoft\u2019s growth in cloud computing has helped push its valuation to historic highs<\/a>, and its investments in the space have positioned it to be prepared<\/a> for the massive computing requirements of AI. Cloud growth has also buoyed revenue<\/a> while hardware including Xbox experienced declines<\/a>.<\/p>\n<\/div>\n

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This kind of information gathering tends to occur at the earlier stages of an investigation, according to George Washington University law professor and former FTC Chair William Kovacic. The two-member, all-Republican commission<\/a> could choose to end it quietly without bringing a complaint, with no minority party commissioners to object or publicize the choice.<\/p>\n<\/div>\n

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The FTC asks specifically about Microsoft\u2019s impact on competition<\/p>\n<\/div>\n<\/div>\n

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Some of the CID questions seem aimed at understanding the cloud industry, including questions about company organizational charts, business and marketing plans, and product roadmaps. It asks the companies to detail plans for bundling multiple features and products, as well as pricing, discounting, and profitability. Other questions appear to probe how challenging it is to break into a market that Microsoft operates in, asking about the costs and barriers to entry involved in entering or expanding into these markets. The FTC asks specifically about Microsoft\u2019s impact on competition, soliciting documents that speak to the impact of Microsoft\u2019s policies or market position as well as details about overall industry bundling and interoperability practices, including at Microsoft.<\/p>\n<\/div>\n

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The agency asks some similar questions about competition around AI products, including competing for customers against businesses that combine extra features or services with an AI or software product like Microsoft 365.<\/p>\n<\/div>\n

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The questions suggest the agency is trying to determine which key market players to watch and how important tactics like bundling are, Kovacic says. The references to AI could suggest that the FTC considers it a potential part of an illegal tying arrangement or an important competitive advantage.<\/p>\n<\/div>\n

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The US isn\u2019t the only country that\u2019s been probing this issue. The European Commission<\/a>, UK Competition and Markets Authority<\/a>, and Japan Fair Trade Commission<\/a> have been investigating Microsoft\u2019s cloud services within the last year. Haurek says Microsoft is \u201ccommitted to working quickly and constructively with the CMA\u201d on its review and is also cooperating with the investigations in Europe and in Japan, where the cloud sector \u201chas never been more dynamic and competitive.\u201d<\/p>\n<\/div>\n

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As a $3 trillion company, it\u2019s \u201calmost inevitable\u201d for Microsoft to become a target of third-party antitrust complaints, Kovacic says. In the US, Microsoft has already faced a government challenge of its Activision Blizzard acquisition, but ultimately prevailed<\/a>, and has yet to face a true recent breakup threat like Google, Meta, Amazon, and Apple.<\/p>\n<\/div>\n

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So far, Microsoft has been largely absent from the calls to break up Big Tech reverberating through political campaigns and the halls of Congress. The company\u2019s business-focused offerings have helped it dodge child safety and moderation fights<\/a> that can create political enemies. Kovacic also credits Microsoft\u2019s adaptation after its earlier monopolization case, saying it\u2019s generally regarded in the industry as \u201chaving the best compliance program\u201d and \u201cthe best approach to dealing with the regulators.\u201d<\/p>\n<\/div>\n

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A case against Microsoft could impact the AI industry as a handful of companies are vying for market share<\/p>\n<\/div>\n<\/div>\n

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In a landmark 1998 complaint, the Department of Justice accused Microsoft of illegally tying its dominant Windows operating system to its Internet Explorer browser, boxing out competitors. While a court ruled against Microsoft, the government ultimately settled, allowing it to avoid a breakup. Still, the case is often credited as reining in Microsoft and allowing then-nascent firms like Google to flourish.<\/p>\n<\/div>\n

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A case against Microsoft could impact the AI industry as a handful of companies are vying for market share. Even when tech companies prevail, antitrust suits can require years of litigation and put internal business operations<\/a> under a microscope<\/a>. Though none so far have resulted in a breakup, Apple<\/a> and Google<\/a> are both under court orders that restrict anticompetitive business practices. Apple and Amazon\u2019s trials have yet to take place.<\/p>\n<\/div>\n

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Kovacic says it\u2019s really the totality of tech antitrust cases that could tip the scales. \u201cThe direction of the entire information services sector is going to depend on the resolution of this very large number of pending cases and investigations involving Big Tech,\u201d he says.<\/p>\n<\/div>\n

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