The Federal Trade Commission’s sweeping investigation of Microsoft Corp. in the waning days of the Biden administration is likely to be a non-starter. It comes presumably weeks before FTC Chair Lina Khan is shown the door by President-elect Donald Trump and a decidedly more tech-friendly administration.
In a letter to Microsoft, the FTC demanded the company fork over information to assist in the agency’s investigation, according to reports in Bloomberg and CNN. The agency is scrutinizing Microsoft’s cloud and software licensing business, artificial intelligence (AI) offerings, and cybersecurity services.
The FTC — which has clashed with Meta Platforms Inc. over its acquisitions of Instagram and WhatsApp, as well as initiated investigations of Amazon.com Inc., NVIDIA Corp., and others — is reportedly examining whether Microsoft abused its software prowess by imposing punitive licensing terms to prevent customers from moving their data from its Azure cloud service to competitive platforms. FTC officials are also looking into Microsoft Copilot, its generative AI chatbot, and its partnership with OpenAI.
But analysts and legal experts view the ambitious probe as more ceremonial than punitive.
“(W)ith Khan out at the FTC in our view and Trump (coming) to the Oval Office (in late January), there will be a much more friendly view towards Big Tech despite some back and forth between Trump and Google,” Wedbush Securities analyst Dan Ives said in a note to investors on Friday. Ives noted the influence of Tesla Inc. and SpaceX CEO Elon Musk, a close adviser to Trump and champion of tech deregulation.
As for Trump, he hasn’t said who he will nominate to lead the FTC, but he is all but certain to replace tech nemesis Khan. The new administration could also toss out any current FTC investigations. Meanwhile, Trump has been meeting with the heads of Meta, Apple, and other companies in recent weeks.
Changes at the FTC signal a wholesale shift in White House policy toward Big Tech for at least several years after, ironically, the first Trump administration first launched antitrust actions against Alphabet Inc.’s Google, Amazon, Meta, and Apple Inc. in June 2019.
The final lingering case, won by the Department of Justice against Google, is likely to wend through courts for years. Justice has proposed that Google sell off Chrome and Android; Google is offering its counter proposal to a federal judge.
