The German Federal Cartel Office initiates investigations against Microsoft. The investigation must show whether Microsoft’s market position in the software market has become too powerful.

The German market surveillance authority Bundeskartellamt announced on March 28 that it had launched an investigation into Microsoft. This doesn’t appear to be directed against any specific practices, but rather out of a general concern that Microsoft has become too powerful in the software market. In 2021, Germany introduced regulations to prevent polyvalent companies from taking control of multiple markets.

Microsoft is an all-rounder today. Microsoft has already found its way into most businesses and households with the Windows operating system, and many Windows users also purchase a 365 subscription. But Microsoft is also one of the largest cloud providers in Europe with Azure and also has a large share of the video conferencing market with Teams. Add to this the tandem of Bing-Edge and LinkedIn and you have an immense ecosystem.

Unfair Advantage

Microsoft can offer all of these services as a bundle, which also gives the company a significant advantage over smaller European providers. And as if that wasn’t enough, with OpenAI it has another trump card that the competition can only dream of. Andreas Mundt, Chairman of the Bundeskartellamt, agrees:

“With Windows and its Office products, Microsoft has long had a very strong position in operating systems and Office software. On this basis, the company has continuously expanded its product range, both for business customers and private customers. Against this background, there is good reason to consider whether Microsoft is of great importance for competition in all markets,” said the CEO.

Rather, the investigation should clarify whether Microsoft is guilty of unfair competition. Any sanctions will be determined in consultation with the European Commission. The research may not remain without consequences. In 2022, the German authority reprimanded Alphabet, the parent company of Google, and Meta for similar reasons. Proceedings against Amazon and Apple are ongoing.

From load to load

Microsoft’s legal department is working overtime in Europe. Germany isn’t the only country Microsoft is suspicious of. An investigation is also currently underway against Azure following a complaint from several European cloud providers, including the French OHV. In this case, an agreement can be reached.

In a statement to The Register, Microsoft pledged to cooperate with the investigation: “As a large technology company, we recognize our increased responsibility to support a healthy competitive environment. We will work constructively with the Bundeskartellamt, which is trying to understand our role in the digital markets.”