US FTC reportedly intensifies Microsoft antitrust investigation involving cloud computing and AI sectors

Recently, Microsoft, a tech giant that has faced market sell-offs due to capital expenditures, has encountered new trouble. The latest news states that the U.S. Federal Trade Commission (FTC) is investigating whether Microsoft is using its own cloud software and artificial intelligence products to create barriers and illegally hinder competition in the enterprise computing market.

As of press time, Microsoft’s recent downturn continues, with its stock price at its lowest point since April last year.

According to informed sources, the FTC has sent civil investigation requests in recent weeks to “at least six” companies competing with Microsoft in the enterprise software and cloud computing markets, covering a range of issues related to Microsoft’s licensing and other business practices.

These investigation requests are similar in practice to civil subpoenas. U.S. regulators are seeking evidence to determine whether Microsoft has intentionally made it more difficult for users to access Windows, Office, and other products on competitors’ cloud services. The regulators are also looking for information on whether Microsoft is bundling AI, security, and identity verification software into its products and services.

It should be noted that these investigations do not always lead to further enforcement actions. The FTC launched its investigation into Microsoft during the final stages of the Biden administration, and it has continued to pursue it during Trump’s second term.

Currently, the case is overseen by FTC Chair Andrew Ferguson. During his tenure, the FTC lost a major antitrust case against Meta and is now appealing that decision.

Regarding the issue of “hindering competition,” Microsoft has stated that due to differences in technical functionality, some of its products are not fully interoperable with competitors’ clouds. Additionally, a series of hacking incidents have put significant pressure on system vendors, prompting them to enhance security features in their core products.

Interestingly, the inquiries into bundling software products with other offerings echo investigations by the U.S. Department of Justice in the 1990s. That case examined how Microsoft embedded Internet Explorer into Windows to weaken competitors like Netscape, thereby illegally expanding its Windows monopoly.

It is reported that the latest FTC investigation mainly focuses on Microsoft’s licensing rules, related to changes introduced in 2019. These changes allegedly made it more difficult, costly, or impossible for users to access certain Windows, Office, and other products on competitors’ clouds. UK regulators are also reviewing these changes.

Additionally, about one-third of the questions concern the company’s artificial intelligence business, reflecting concerns that Microsoft, after investing in OpenAI and heavily relying on its software, has canceled some of its own projects, thereby eliminating potential competition.

The FTC issued a data request to Microsoft in late 2024, demanding extensive information about its AI operations, including training models and costs of data acquisition. The agency also asked for detailed information about data centers, efforts to meet customer demand for sufficient computing power, and software licensing practices.

(Source: Cailian Press)