FTC Launches Broad Antitrust Investigation into Microsoft's Cloud, AI, and Cybersecurity Practices

Microsoft facing its biggest US FTC antitrust investigation yet

FTC set for new leadership, potentially Microsoft's 'get out of jail' card The US Federal Trade Commission (FTC) has reportedly launched a broad antitrust investigation into Microsoft, challenging the company's business practices across cloud computing, artificial intelligence and cybersecurity markets. First reported by Bloomberg, the proposed investigation would focus on allegations of market dominance and other potentially anticompetitive practices. The company has already faced criticism over bundling software within Azure services, imposing technical limitations and offering preferential pricing, all of which locks customers into the company's ecosystem. This isn't the first time Microsoft has had to fight off antitrust regulators - in the European Union, Google recently called for stricter oversight of Microsoft's licensing terms. The company also reached a settlement with the Cloud Infrastructure Services Providers in Europe group (CISPE) earlier this year; at that point, CISPE Secretary General Francisco Mingorance said this would mark the end of that battle. In the cybersecurity space, Microsoft has faced criticism over the integration of its Defender antivirus within the Windows operating system, making it more difficult for other antivirus software providers to sell their own solutions and raising monopoly concerns. A third branch of the reported FTC investigation, focusing on artificial intelligence, explores Microsoft's deep integration with OpenAI. The company notoriously invested billions into the startup not long after ChatGPT went public, and its large language models have been used across various Microsoft applications over the years that followed. Microsoft isn't the only company facing increased pressure from the FTC - the Commission has been cracking down on many rival firms, including Amazon, Google and Meta, too. However, all of this could be about to change with the upcoming departure of FTC Chair Lina Khan, who has been known for her aggressive stance toward Big Tech. In contrast, the Trump administration promises a more business-friendly approach.

The FTC against Microsoft: cloud, AI, and cybersecurity in the spotlight - Softonic

The accusations referred to whether Microsoft abuses its dominant market position by applying restrictive licensing conditions Microsoft has been battling the Federal Trade Commission of the United States for about two years. At the time, the fight was over the acquisition of the video game giant Activision / Blizzard / King. Now the investigation is focused on its other business areas. The U.S. Federal Trade Commission (FTC) has launched an antitrust investigation into Microsoft, examining its cloud computing, software licensing, cybersecurity, and artificial intelligence businesses. The investigation follows more than a year of informal interviews with competitors and business partners, Bloomberg has reported. The FTC's antitrust lawyers have sent Microsoft a detailed information request, spanning hundreds of pages, after receiving approval from FTC Chair Lina Khan. The investigation focuses on Microsoft's bundling of productivity and security office software with its cloud services, a practice that critics say harms competitors in the authentication and cybersecurity markets. The FTC is particularly examining Microsoft Entra ID, its user authentication service, amid complaints that the licensing conditions and integration with its cloud offerings hinder rival companies. The role of Microsoft as a major government contractor and the recent cybersecurity incidents related to its products have added urgency to the investigation. The company provides services worth billions of dollars to U.S. agencies, including the Department of Defense, making its practices crucial for national security. In November 2023, the FTC expressed its concern about the concentrated nature of the cloud market, warning that disruptions or performance issues could spread throughout the economy. The authority then gathered opinions from civil society, sector stakeholders, and academia to prepare its report. According to the feedback received, most of the concerns were related to competition and licensing practices. Also in the United Kingdom, Microsoft is facing a similar antitrust investigation by the Competition and Markets Authority. The investigation is a result of the complaint filed by AWS with the CMA against Microsoft for unfair business practices. The FTC's investigation could have far-reaching implications for the tech giant's market practices and for the broader cloud and cybersecurity sectors.

Microsoft hit with antitrust probe by US authorities over its cloud and AI practices

TL;DR: The US Federal Trade Commission is investigating Microsoft's business practices in cloud, artificial intelligence, and information security. Concerns include exclusive Azure deals, security breaches involving government emails, and Microsoft's partnership with OpenAI, potentially avoiding regulatory scrutiny. The probe aims to assess Microsoft's influence and compliance in these sectors. Microsoft has reportedly been asked by the US Federal Trade Commission (FTC) to provide information on its business practises in the following markets: cloud, artificial intelligence, and infosec. According to sources who spoke to CNN, The Washington Post, and Bloomberg, the FTC has launched a probe into Microsoft and requested that the company provide the regulator with information on the three aforementioned businesses and others that aren't listed. What could the regulator be investigating specifically? As for cloud practices that could be in violation, European authorities have pressed Redmond over its deals being exclusive to Azure customers. Microsoft security could also be another point of interest for regulators as Microsoft's products have recently become compromised, leading to foreign adversaries infiltrating government email accounts and making off with valuable information. As for artificial intelligence, European authorities are already questioning if Microsoft's close $10 billion partnership with OpenAI is intentionally designed to avoid the microscope of an official acquisition but still maintain the level of influence or control on the market.

FTC vs. Microsoft: Cloud, AI, and security practices under investigation

The Federal Trade Commission (FTC) has initiated a comprehensive antitrust investigation into Microsoft, scrutinizing its practices across several business sectors, including cloud computing, artificial intelligence, and cybersecurity products. Reports indicate that the investigation aims to assess whether Microsoft has violated antitrust laws through its operations. FTC's inquiry reflects the Biden administration's ongoing regulatory crackdown on large tech companies, which could shift under the incoming Trump administration. The investigation comes as part of a broader strategy to address competitive practices among prominent tech firms, including Amazon, Google, and Meta, each facing similar scrutiny in recent years. The FTC's investigation focuses on how Microsoft bundles its cloud offerings with its office and security tools, potentially impacting competition. The agency has demanded extensive documentation from Microsoft, reportedly involving hundreds of pages of information related to its AI products, software licensing practices, and specific business operations surrounding its cloud services. FTC's Click-to-Cancel rule is ending the subscription trap Bloomberg reports that FTC lawyers plan to meet with Microsoft competitors to gain further insight into the company's market practices. Of particular interest is Microsoft's Entra ID, a security tool that manages authentication for cloud-based logins, raising questions about the impact of its utilization on competitive neutrality. Previously, The New York Times highlighted a significant agreement between the Justice Department and the FTC that paved the way for investigations into Microsoft, artificial intelligence developer OpenAI, and chip designer Nvidia, all of which have evaded substantial antitrust scrutiny during the Biden presidency. The FTC's current focus on Microsoft follows allegations that the tech giant imposed restrictive licensing terms that discourage users from migrating data to rival cloud platforms.

FTC reportedly launches antitrust investigation into Microsoft's cloud, AI and cybersecurity practices - SiliconANGLE

FTC reportedly launches antitrust investigation into Microsoft's cloud, AI and cybersecurity practices The U.S. Federal Trade Commission has reportedly opened an antitrust investigation into various aspects of Microsoft Corp.'s business, including the company's cloud computing, software licensing, cybersecurity and artificial intelligence offerings. The investigation comes after FTC was reportedly preparing to launch an investigation into claims that Microsoft earlier this month. It was claimed that the FTC was investigating allegations that Microsoft was abusing its market power by imposing punitive licensing terms to prevent customers from moving their data from Azure to other platforms. The reportedly now official investigation is said to go further than licensing terms for Azure and other cloud products alone. Reports suggest that alongside concerns in relation to Microsoft's licensing conditions, the FTC is also investigating Microsoft's cybersecurity business and AI products. As part of the investigation, the FTC has crafted a detailed request - said to be hundreds of pages long - to force Microsoft to turn over information. According to Bloomberg, the FTC's scrutiny comes after a string of cybersecurity incidents that involved Microsoft products. The company is a top government contractor, providing billions of dollars in software and cloud services to U.S. government agencies, including the Defense Department. The request was also signed off by the soon to be former FTC Chair Lina Khan. Khan is set to be replaced following the election of Donald J Trump as the 47th President of the U.S. As noted when the FTC was first reported to be considering an investigation, the change of Administration is key here. Khan's decision to pursue Microsoft right ahead of the incoming new government could be argued to be nothing more than performative virtue signaling theater - the investigation runs the very risk of simply being closed following Jan. 20, but that said, it's not clear what position the incoming Trump Administration will take on antitrust issues. Republicans have, in the past, publicly expressed concerns about big tech companies and their practices. On the flip side, the incoming administration may go easier on big tech companies as part of a promise to decrease regulation and other hurdles that it says stifle innovation and growth. Whichever direction the investigation goes, it's known which company was a key driver behind the push for an investigation and that's Google LLC. Google wrote to the FTC in June 2023, accusing Microsoft of anticompetitive practices. In the letter, Google claimed that Microsoft employs software licensing restrictions that effectively force customers to use its Azure cloud computing services in order to save money. The accusations included that Microsoft takes advantage of the dominant position of Windows Server and Office to pressure customers to use Azure and uses a "complex web" of licensing restrictions that are designed to prevent businesses from diversifying their enterprise software vendors.

Microsoft faces fresh antitrust probe by US authorities

Investigation is apparently sweeping, but keen on info about AI, security, and cloud The US Federal Trade Commission appears to have launched an antitrust investigation into Microsoft. News of the probe was first reported by Bloomberg. The Washington Post and CNN have since also found anonymous sources willing to tell them that the regulator has asked Microsoft to provide it with info on its cloud, AI, and infosec businesses. The Commission (FTC) is silent on the matter - and probably will be until next week due to the Thanksgiving holiday - but it's not hard to guess what might concern it. On the cloud front, European authorities have problems with the fact Microsoft's best deals for its software are offered only to Azure customers. Microsoft has made some concessions, but Google wants more action and has helped to form a group of Euro-clouds that's lobbying for change. Microsoft's security activities could matter in two ways. One is the unfortunate tendency of its products and services to have flaws that allow very bad things like Chinese spies cracking Exchange Online and reading government officials' emails. Another is Defender's inclusion in Windows making rival antivirus tools all-but-redundant. To consider possible AI-related actions we must look to Europe, where regulators have pondered whether Microsoft's very close partnerships with OpenAI and similar arrangements are designed to avoid the scrutiny that comes with an acquisition, but allow the same kind of market dominance. Microsoft is no stranger to antitrust cases in the US, where the 1998-2001 US vs Microsoft case saw the software giant found to have a monopoly on PC operating systems and ordered to break itself up into one org to produce OSes and another for other software. A subsequent settlement made that remedy unnecessary, after Microsoft promised to change some of its practices - and the value of that arrangement can perhaps be seen in Redmond's failure to develop a viable ecosystem for its mobile operating systems (which were mostly dire until Windows Phone 7). This case is not certain to get off the ground. The incoming Trump administration has already signalled current FTC chair Lina Khan will not be retained, and actions she instigated could be halted. However, Trump's proposed Federal Communications Commission head, Brendan Carr, is also no fan of Big Tech and has labelled Microsoft a participant in a "censorship cartel." Trump buddy Elon Musk has also opposed Microsoft's OpenAI deal. If those positions are shared by other senior administration appointees, Microsoft could have interesting times ahead. ®

F.T.C. Launches Antitrust Investigation Into Microsoft

Regulators are demanding information from the company on its cloud computing, artificial intelligence and cybersecurity products. The Federal Trade Commission has opened an investigation into whether Microsoft has violated antitrust law in multiple segments of its wide-ranging business, according to two people familiar with the matter, the latest salvo in a battle by the government to rein in the most powerful tech companies. The agency recently sent a long and detailed formal request for information to the company asking about its cloud computing, artificial intelligence and cybersecurity products, the people said. Of particular interest to the F.T.C. is the way that Microsoft bundles its cloud computing offerings with office and security products, they added, alongside the company's growing power in the artificial intelligence space. The inquiry signals an intensifying focus on the power of the biggest tech companies over the way people consume information, communicate and shop online. Already, the F.T.C. has sued Amazon and Meta, accusing them of anticompetitive behavior and stifling rivals. The Justice Department has also sued Google over its dominance in advertising technology, and Apple for making it difficult for consumers to leave its tightly knit universe of devices and software. Microsoft, one of the most valuable companies in the world with a disparate business that includes its Windows operating software, social media platform LinkedIn and video game platform Xbox, had so far largely escaped the recent ramp up in antitrust scrutiny. Microsoft and the F.T.C. declined to comment. Bloomberg and The Financial Times first reported details of the investigation. This is a developing story. Check back for updates.

Lina Khan-Headed FTC Approves Probe Into Microsoft's Cloud And AI Practices Amid Antitrust Scrutiny: Report - Apple (NASDAQ:AAPL), Amazon.com (NASDAQ:AMZN)

Microsoft Corp. MSFT is confronting a federal investigation that could reshape the technology industry's competitive landscape, with regulators examining the company's potentially anticompetitive practices in cloud computing and artificial intelligence markets. What Happened: The U.S. Federal Trade Commission has initiated a broad investigative effort focusing on Microsoft's licensing strategies and market conduct, particularly within its Azure cloud service ecosystem. Reuters report, which cited sources, reveals that the probe extends beyond traditional technological assessments, delving into intricate questions about market power and consumer choice. The probe, approved by FTC Chair Lina Khan before her anticipated departure, centers on allegations that Microsoft is exploiting its market power to restrict customer mobility between cloud platforms. Tech industry observers note the investigation represents a significant moment for Microsoft, traditionally viewed as more collaborative compared to other Big Tech entities. Microsoft did not immediately respond to Benzinga's request for comment. The investigation emerges against a backdrop of intensifying regulatory scrutiny of Big Tech companies. While firms like Meta Platforms META, Apple Inc. AAPL, and Amazon.com Inc. AMZN have faced similar antitrust challenges, Microsoft has traditionally navigated these waters with greater apparent ease. See Also: Bitcoin, Ethereum, Dogecoin Surge As Traders Raise Risk Appetite Ahead Of Thanksgiving: Analyst Sets Mid-Term Price Target For ETH At $6K What Happened: Regulatory challenges are emerging across multiple technological fronts, with NetChoice and other industry groups highlighting potential barriers that might prevent customers from seamlessly transitioning between cloud platforms. The timing of the probe adds complexity, occurring during a potential presidential transition that could dramatically alter enforcement priorities. Price Action: Microsoft stock closed at $422.99 on Wednesday, down 1.17% for the day. In after-hours trading, the stock dipped further 0.24%. Year-to-date, Microsoft has gained 14.05%, according to data from Benzinga Pro. Read Next: Mark Zuckerberg And Trump Reportedly Met At Mar-A-Lago Image Via Shutterstock Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Market News and Data brought to you by Benzinga APIs

FTC launches antitrust investigation into Microsoft as Biden era ends

The Federal Trade Commission sent a broad request to the tech giant asking for information on its cloud, software, and AI businesses. The Federal Trade Commission has launched a broad antitrust investigation into Microsoft's business empire -- a late-game shot at Big Tech from the Democratic-led agency in the final weeks of President Joe Biden's administration. The FTC sent a demand for documents to Microsoft Wednesday that asks for detailed information on several of the company's businesses. Those of interest include its cloud computing services, artificial intelligence tools and cybersecurity software, according to a person familiar with the investigation who spoke on the condition of anonymity to discuss the agency's private plans. The probe comes after a year of preparation from the FTC, and amid a flurry of action from the Biden administration as it seeks to cement its impact before stepping aside for president-elect Donald Trump. Under Biden appointee Lina Khan, the FTC has taken an aggressive run at Big Tech companies, suing to try and stop large mergers and investigating a string of tech companies for alleged antitrust infractions. Biden's Justice Department has also brought lawsuits against Big Tech, and proposed earlier this month that a federal judge should force Google to sell off its Chrome browser after he ruled in August that Google held an illegal monopoly in internet search. Spokespeople for Microsoft and the FTC declined to comment. Bloomberg News earlier reported that the agency had sent a request for information to Microsoft. Trump has not made clear what his plans for the FTC and DOJ's investigations and lawsuits into Big Tech will be. Tech analysts and executives widely expect him to fire Khan, who is unpopular with tech leaders and investors. Elon Musk posted on X before the election that Khan would "be fired soon." Trump has yet to name his pick for FTC chair. Trump has lashed out major tech companies for years, accusing companies like Meta and Google of censoring conservative voices and trying to work against him. Brendan Carr, Trump's pick to head the Federal Communications Commission, said last week he wants to "smash the censorship cartel," referring to large social media platforms, which kicked Trump off their platforms in the wake of the Jan. 6 attack on the Capitol, but later reinstated his accounts. At the same time, Trump is expected to institute a lighter touch in some areas of tech regulation, including cryptocurrency, acquisitions, and restrictions on AI. The Biden administration's investigation into Microsoft comes nearly 25 years after the Justice Department sued the company in the late 1990s. Though that did not lead to a breakup of the company, tech historians and analysts say it reined in Microsoft enough that it allowed new companies like Google to get ahead in developing the potential of the internet. Microsoft survived and has pushed its way back into the Big Tech pantheon. It is currently the world's third-most valuable company after Apple and AI chipmaker Nvidia. Microsoft's cloud business is the second largest in the world after that of Amazon and shapes the daily experience of billions of people through its PC operating systems and office software. The Windows maker's multibillion dollar partnership with ChatGPT maker OpenAI also gives it a key position in the race to build and sell the best AI tools. Microsoft is not the FTC's only new target as the Biden administration prepares to cede power. The agency is also investigating rideshare company Uber over whether its UberOne subscription product violated consumer protection laws, a person familiar with the probe, who spoke on the condition of anonymity to discuss private information, said. Customers have complained that the product is difficult to cancel, the person said. A spokesperson for Uber disputed that. "Uber One members can easily cancel their membership in the app -- in fact, the majority of those cancellations take 20 seconds or less," the Uber spokesperson said.