As a tech enthusiast with years of experience under my belt, I must admit that the current state of affairs between Microsoft and the FTC is quite intriguing. Lina Khan’s persistent antitrust probes against Microsoft, following her unsuccessful attempts to block the acquisition of Activision-Blizzard, are reminiscent of a cat chasing a laser pointer – always close but never quite reaching the end goal.
FTC Chair Lina Khan really doesn’t like Microsoft.
Last year, Lina Khan played a significant role in efforts aimed at preventing Microsoft from purchasing Activision-Blizzard. She invested vast sums of money into hearings with the intention of derailing Microsoft’s plan to acquire the company behind Call of Duty. However, since the merger, all of Khan’s arguments against the deal have proven to be invalid. Indeed, Microsoft has kept its word by ensuring that Call of Duty remains available across multiple platforms, and as promised, they’ve added Call of Duty and other Activision titles to Xbox Game Pass, significantly reducing costs for consumers. But alas, despite these positive outcomes, the story doesn’t end quite so happily as everyone might think…
It seems that Khan may have been unhappy with Microsoft’s business practices regarding Activision-Blizzard, leading him to launch a new antitrust investigation into Microsoft. This allegation, reported by Reuters, focuses on Microsoft’s cloud business and cybersecurity division. Critics, such as Google, Amazon, and Oracle, who represent competitors in the cloud sector, have criticized Microsoft’s Azure platform for offering additional benefits like Office and Outlook in exchange for switching platforms. Additionally, Microsoft has been accused of making it excessively difficult to switch providers, keeping customers tied to its services rather than dealing with the hassle of switching. As of now, Microsoft has not responded to these claims.
Currently, there’s a significant amount of concern about tech giants like Google, Amazon, and Apple in the U.S. due to allegations of monopolistic practices. For instance, Google could be forced to sell off Chrome and even Android, following accusations from a Federal Judge that it has a search and ad monopoly. Similarly, the FTC is examining Amazon’s retail division, claiming they exploit their market dominance by artificially increasing prices for consumers and third-party vendors. The U.S. Department of Justice accused Apple in March 2024 for maintaining a stranglehold on the smartphone market, using its platform to control mobile payments and raise prices via App Store policies.
Is Microsoft in trouble?
The tech giants like Microsoft, often referred to as “Big Tech,” may encounter a transformed regulatory landscape in the near future due to Donald Trump’s election victory in the U.S. The Federal Trade Commission (FTC) could undergo significant changes, with Khan likely stepping down and being replaced by a Republican who tends to favor business and deregulation. However, an interesting wildcard is Elon Musk, CEO of Tesla and X, who aligns politically with Trump and is expected to hold a high-ranking position in the U.S. government for a tech executive. This could give him significant influence over future policies, particularly those related to AI, as he’s developing his own xAI company in opposition to Microsoft and its collaboration with OpenAI. Musk has openly criticized Microsoft and even involved them in a recent lawsuit against OpenAI.
Generally speaking, it’s usually assumed that lawsuits against Microsoft would be dismissed by Trump due to the company’s prominent position in the U.S. economy. With a massive workforce numbering in the hundreds of thousands and raking in billions worldwide for its predominantly American investors, it’s more often associated with the right (Republicans) when it comes to business deregulation. However, the lines between Democrats and Republicans have blurred somewhat, as many officials from both parties hold substantial investments in tech giants like Apple, Google, and Microsoft. These companies have largely been left unscathed by regulations for over a decade.
Microsoft, aside from its commercial ventures, also holds substantial agreements with the U.S. government, spanning email services to military contracts for hardware such as HoloLens. This year, Microsoft’s email services experienced a breach by Russian state-backed hackers, granting them access to sensitive government documents. After this incident, CEO Satya Nadella led a major overhaul of the company’s security measures. However, events like this and the summer’s CrowdSource issues might be points of discussion in the ongoing investigation.
The final outcome is yet uncertain, but it’s probable that it won’t look very appealing regardless. Following the announcement, Microsoft’s stocks dropped by 1% during extended trading. However, shareholders appear relatively unfazed, at least momentarily.
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2024-11-28 18:39