The U.S Federal Trade Commission FTC has now launched an extensive antitrust investigation into Microsoft, to address its continued monopolistic control of software licensing for cloud computing and artificial intelligence (AI) markets. This probe was greenlit by FTC Chair Lina Khan ahead of the company as critics fear that it is using its dominance to snuff out competition.

Focus on Cloud and Software Licensing

The core of FTC’s investigation concerns whether Microsoft is using unreasonably detrimental licenses to tie customers to use the Azure cloud platform and switch to its competitors. This practice, if proven, can also be perceived as an abuse of power in the market of cloud services.

Regarding other product novelties and services, the FTC is also investigating Microsoft’s cybersecurity and artificial intelligence options which have increased the range of the probe. Google and other lobbying groups such as NetChoice have in the past accused Microsoft of anti-competitive behavior.

NetChoice, which represents Amazon and Google, complained to Microsoft about leveraging its Office- and Outlook-related dominance to embed AI tools. “The impact and scope of the licensing issues at Microsoft are unprecedented,” the group said, focusing on the company’s dominance.

International Observation and Complaints in Europe

Several issues have not only caught the attention of consumers in the United States but in the European Union as well. This September, Google turned to the European Commission alleging that Microsoft overcharges the rival cloud platforms 400% for running Windows Server and keeps up critical security updates on services that are not Microsoft’s.

The FTC investigation is part of a larger global push to investigate big tech firms, but Microsoft has not received the level of antitrust pressure as Google, Meta, Apple, and Amazon.

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Impact of Political Transition

The direction of the investigation may depend on the new administration of the United States. There is however confusion on how the probe will continue especially with President-elect Donald Trump preparing to take the helm in January. Trump’s past administration initiated numerous antitrust probes against Big Tech, though his policies came to the rescue of companies such as Microsoft.

For instance, in 2019, Microsoft won a $10 billion cloud contract from the Pentagon and Amazon accused Trump of participating in the procurement.

Still, it is unclear whether the incoming administration will share this view on Big Tech, though approval of the investigation by FTC Chair Lina Khan indicates that efforts to challenge Microsoft’s conduct will be made before the transition of power.

Microsoft’s Response and the Future Perspective

Microsoft has not issued any comment on the latest investigation. The firm has been rampantly defending its operations, especially in the recent past as the company’s CEO Satya Nadella testified in Google’s antitrust case while also protesting Google’s tied AI training partnerships.

While the FTC gathers vast information regarding Microsoft’s workings, the findings of this investigation may establish new benchmarks for dealing with competition in cloud computing and AI. Advertisements and other campaigns based on this probe are critical developments for the tech giant, as billions depend on the outcome of this investigation, and its competitors are now closely monitoring the process.