The Federal Trade Commission (FTC) is preparing to open an investigation into alleged anti-competitive practices by Microsoft’s cloud division. The department is studying the company’s accusations of abusing its dominance in the work software market – Microsoft allegedly imposes licensing conditions that prevent customers from transferring data from the Azure platform to competitors’ cloud services, the Financial Times reports, citing its own sources.
Anti-competitive measures include, among other things, substantially increasing subscription fees for those leaving, charging high fees for quitting a company’s services, and allegedly making Office 365 products incompatible with competing cloud services. The FTC has not yet made formal requests for documents or other information as part of its review. The effort to challenge Microsoft’s cloud business practices is likely to be FTC Chairwoman Lina Khan’s latest attack on big tech companies. During her tenure, she made significant efforts to limit the market dominance of companies such as Meta✴ and Amazon.
With Donald Trump returning to the White House, someone else will likely take her place. Khan’s successor may take a less assertive stance, but likely contenders for the job are still expected to continue pursuing the tech giants that have angered both major parties in Washington. Republicans have accused online platforms of censoring conservative speech. The decision to launch a formal review will come after the FTC seeks feedback from industry and the public about cloud service providers’ business practices. In November last year, the majority of respondents expressed concern about competition in this sector – even then the agency pointed to software licensing practices that limit the possibility of its use in cloud services of other companies. Customers are also charged for data transfers from certain cloud systems.
Microsoft has drawn attention from regulators in other countries over similar issues. The British Competition and Markets Authority (CMA) began checking the activities of Microsoft and Amazon following a signal from the telecommunications regulator Ofcom – clients of cloud platforms complained to him that they were “tied” to one supplier: they were offered discounts for exclusivity, and were charged for refusing services . In the EU, Microsoft managed to avoid a formal antitrust investigation by striking a deal with a group of competing cloud service providers. In 2022, the FTC tried to block the software giant’s takeover of game publisher Activision Blizzard in court – a federal court rejected the agency’s demands, and its decision is now being appealed.
The volume of the cloud services market at the end of 2023 amounted to $561 billion; in 2024, according to Gartner, it will grow to $675 billion, and in 2025 it will reach $825 billion. The leader is Amazon Web Services with 31% of the market, the second place belongs to Microsoft with 20%, and the third is Google Cloud with 12% of the market.
If you notice an error, select it with the mouse and press CTRL+ENTER.