US FTC Intensifies Scrutiny of Microsoft Over AI and Cloud Business Practices

WASHINGTON, Feb 13 (GeokHub) — The U.S. Federal Trade Commission has stepped up its examination of Microsoft, expanding inquiries into the company’s AI, cloud computing, and enterprise software practices, according to people familiar with the matter.

The regulator has reportedly issued civil investigative demands to several of Microsoft’s competitors in the enterprise software and cloud markets in recent weeks. Sources indicate that at least half a dozen firms have received formal requests for information as part of the probe.

Focus on AI Bundling and Cloud Licensing

The latest scrutiny centers on Microsoft’s practice of bundling artificial intelligence tools, security software, and identity management services into its broader product ecosystem. Regulators are assessing whether these strategies could limit competition in rapidly growing AI and cloud segments.

Authorities are also examining licensing terms tied to Microsoft’s productivity and server software — specifically whether certain conditions make it harder for customers to shift workloads to competing cloud platforms.

Azure Lock-In Concerns

Some industry rivals have argued that Microsoft’s business model creates barriers that effectively lock customers into its Azure cloud infrastructure.

In 2024, under then-Chair Lina Khan, the FTC launched an earlier investigation into whether Microsoft used restrictive licensing arrangements in its productivity software portfolio to maintain dominance in cloud services.

The issue gained international attention when Google filed a complaint with the European Commission in September 2024. Google alleged that Microsoft leveraged its dominant Windows Server operating system to disadvantage competitors in the European cloud market.

AI Competition in the Regulatory Spotlight

The renewed scrutiny reflects broader regulatory concerns over how artificial intelligence is being integrated into enterprise ecosystems. As major technology firms embed AI capabilities directly into cloud and productivity platforms, regulators globally are assessing whether such integration strengthens innovation — or entrenches market power.

Microsoft and the FTC have not publicly commented on the latest developments.

The investigation signals growing oversight of Big Tech’s AI strategies, particularly as cloud computing becomes the backbone of enterprise AI deployment worldwide.