The UK’s Competition and Markets Authority (CMA) has announced the opening of an investigation into Microsoft’s dominance in the realm of professional software. It marks the fourth inquiry launched under the regulator’s new powers to scrutinise large tech firms, granted last year.
The investigation rests on the so-called Strategic Market Status (SMS) mechanism, which enables the CMA to intervene in a targeted way to promote competition, without presuming illegal conduct by the company in question. This framework also empowers the regulator to step into the cloud market.
At the heart of the inquiry: product bundling
The CMA will assess whether bundling together products like Windows, Word, Excel, Teams, Copilot and other pieces of the Microsoft suite constitutes an anti-competitive practice. The regulator will also examine whether competitors in the field of artificial intelligence can integrate with Microsoft’s professional software, as well as licensing practices in cloud services.
Sarah Cardell, the CMA’s chief executive, emphasized the economic stakes involved: “Professional software is a cornerstone of the British economy, relied upon by hundreds of thousands of customers. Our aim is to understand how these markets are evolving, where Microsoft stands within them, and to consider what targeted actions may be necessary to ensure that UK organisations have access to choice, innovation and competitive pricing.”
A Microsoft spokesperson said the American company was “determined to work quickly and constructively with the CMA” to facilitate its review of the professional software market.
Microsoft frequently targeted by the CMA
This is not the first time Microsoft’s cloud has drawn the regulator’s attention. The CMA has previously voiced concerns about the dominant positions of Amazon and Microsoft in the cloud, notably highlighting the latter’s licensing practices.
In March last year, the two firms agreed to reduce certain cloud fees, doing just enough to avoid tougher actions. The CMA nevertheless chose to include Microsoft’s cloud licensing practices within the scope of the new SMS investigation.
Microsoft is facing antitrust probes in several jurisdictions, including the European Union and the United States, regarding its professional software, its cloud infrastructure and its AI partnerships.
The British inquiry is expected to conclude by February 2027.
