Microsoft has formally requested that the Federal Trade Commission’s (FTC) inspector general investigate whether details of its antitrust investigation were improperly leaked by the agency’s management and urged the findings to be made public.
The company’s demand follows a Bloomberg report that revealed the FTC’s ongoing probe into Microsoft’s operations. The investigation reportedly covers Microsoft’s cloud and software licensing practices, artificial intelligence offerings, and cybersecurity solutions. This was later confirmed by The Verge.
Allegations of FTC Ethics Violations
Rima Alaily, Microsoft’s corporate vice president and deputy general counsel, has accused FTC leadership of violating its own ethical guidelines by leaking confidential information about the investigation. According to Alaily, the information cited in Bloomberg’s report strongly implies it originated from within the FTC. The agency’s ethics guidelines explicitly classify the existence of an investigation as nonpublic unless the Office of Public Affairs deems it appropriate to disclose—typically after the investigated party has made it public via a press release or government filing. However, the guidelines also permit the FTC to disclose information when it deems doing so to be in the public interest.
Alaily further referenced a September report from the FTC’s inspector general, which highlighted an uptick in “unauthorized disclosures” of nonpublic information to the media over the past two years. She argued that the Bloomberg report aligns with what she perceives as a concerning trend of strategic leaks by the FTC.
Microsoft’s Response to the Leak
Microsoft claims it first became aware of the FTC’s information demand through the Bloomberg story rather than direct communication from the agency. Alaily noted that when the company reached out to FTC staff to verify the claims, they refused to confirm whether the information request existed. As of now, Microsoft asserts that it has yet to receive the reported demand for information.
This incident marks another chapter in the heightened tension between Microsoft and regulatory authorities. In recent months, the company has adopted a more assertive stance in addressing antitrust scrutiny. For instance, in October, Alaily accused Google of orchestrating a covert campaign to undermine Microsoft by influencing competition regulators and policymakers while misleading the public.
Shifting Focus on Microsoft
Unlike some of its Big Tech counterparts, Microsoft has largely avoided being the primary focus of antitrust lawsuits in the past decade. However, this period of relative regulatory reprieve appears to be coming to an end. In recent years, Microsoft has faced increasing scrutiny both in the United States and Europe over several issues, including significant cybersecurity vulnerabilities, its high-profile acquisition of game developer Activision Blizzard, and its deepening collaboration with OpenAI.
These developments suggest that regulators are paying closer attention to Microsoft’s business practices, particularly in light of its growing influence in emerging technology sectors like AI and its role in critical digital infrastructure. While Microsoft’s handling of its cloud, software, and AI operations was previously overshadowed by the controversies surrounding companies like Google, Meta, and Amazon, the FTC’s probe signals that it may no longer be flying under the radar.
Broader Context of FTC Investigations
The FTC has been intensifying its regulatory efforts against Big Tech companies, focusing on anticompetitive practices and consumer protection. As Microsoft continues to expand its footprint in areas such as AI-driven tools and cloud services, the company’s actions are drawing comparisons to those of its peers, which have faced hefty fines and legal challenges.
The agency’s investigation also underscores a broader shift toward scrutinizing the competitive dynamics of the tech industry, particularly as companies increasingly consolidate power through acquisitions and partnerships. For Microsoft, its partnership with OpenAI and the implications of its Activision Blizzard acquisition have placed it squarely in the crosshairs of regulators looking to assess the balance of power in digital markets.
Future Implications
The outcome of the FTC’s probe into Microsoft will depend on how regulators assess the company’s practices and their alignment with antitrust laws. Microsoft’s call for transparency and an investigation into alleged leaks could also shape public perception of the FTC’s handling of sensitive cases. Moreover, it reflects Microsoft’s strategic approach to manage its image amid increasing scrutiny.
By pushing back against perceived regulatory overreach or unethical practices, Microsoft is not only defending itself against specific allegations but also seeking to influence the narrative around its role in the tech industry. As regulators continue to examine the competitive landscape of Big Tech, Microsoft’s ability to navigate these challenges will be pivotal in determining its future trajectory.
This incident adds another layer of complexity to the evolving relationship between Microsoft and regulatory authorities, highlighting the delicate balance between fostering innovation and ensuring fair competition in the tech sector.