FTC Investigates Microsoft Cloud Services and AI for Potential Monopolistic Behavior
Claire Weston
The FTC has sent civil investigative demands to at least six Microsoft rivals, probing exclusionary practices in Azure cloud and AI — this means Microsoft faces its most serious antitrust scrutiny in over two decades.
What exactly is the FTC investigating?
The core question: whether Microsoft uses its Azure cloud and AI market position to unfairly shut out competitors.
The FTC issued civil investigative demands (CIDs) under the FTC Act — each over 15 pages, with more than 15 questions — covering commercial agreements, licensing terms, and product interoperability.
This means → the FTC is not running a casual review; it is systematically dissecting Microsoft's business structure and lock-in mechanisms in cloud.
What is Microsoft accused of doing?
The flashpoint is a 2019 licensing change: multiple parties complained anonymously that the new terms sharply raised the cost of running Windows software on non-Azure infrastructure.
In plain terms = you buy Microsoft's software, but if you don't use Microsoft's own cloud, the cost goes up artificially — that is what "cloud lock-in" looks like.
In 2023, Google formally accused Microsoft of leveraging dominance in areas like operating systems to gain "unfair advantages" for Azure and lock in customers.
How has Microsoft responded?
Spokesperson Alex Haurek said the company is fully cooperating with the investigation and "believes its practices promote competition."
Microsoft pointed to Google Cloud's 63% year-over-year growth as evidence that the cloud market is robustly competitive — no monopoly possible.
This means → Microsoft's core defense: competitors are growing fast, so the market cannot be monopolized.
Where does this go from here?
Former FTC Chair William Kovacic noted the investigation is still in its early, information-gathering stage.
The FTC currently has two Republican commissioners; the commission can quietly close the probe without filing suit — and without public disclosure.
In plain terms = there are two paths: either it escalates into formal litigation and Microsoft faces its biggest legal challenge since the PC operating-system antitrust case, or it ends silently, with the public none the wiser.
Why does this matter?
The investigation began under the Biden administration and continues under Trump — spanning two presidencies signals it is not a purely political move.
If it escalates to litigation, it will be Microsoft's first major antitrust legal battle in over twenty years.
This reflects a systemic regulatory concern over market concentration in cloud and AI — not just a Microsoft story, but a signal about the shape of the entire industry.
Content is for reference only, not financial advice.