Britain opens probe into Microsoft

Britain’s competition regulator on May 14 opened an investigation into whether Microsoft should face special oversight in business software under the country’s new digital markets law. The Competition and Markets Authority said it was examining Microsoft’s position across products used daily by UK companies and public bodies, including Windows, Word, Excel, Teams and Copilot. The case is the fourth “strategic market status” investigation launched since the UK’s digital markets regime took effect in January 2025. If Microsoft is designated, the CMA could later impose conduct requirements or other interventions aimed at promoting competition. ### Why did the CMA open this case now? The CMA said on May 14 that it had “heard” UK customers may not always be able to combine Microsoft software effectively with products from other providers. The regulator said that could limit access to competing tools and prices, and it said it would examine whether Microsoft can use its position to restrict customer choice. (gov.uk) A March 31 CMA policy paper had already signaled the move. That document said the agency had heard broader concerns about Microsoft’s role in business software, especially in productivity software, operating systems, database management and related security services, and linked those concerns to the growing use of AI features in workplace software. (gov.uk) ### Which Microsoft products are in scope? The CMA said the investigation covers Microsoft’s “business software ecosystem,” not a single product. The regulator listed productivity software, personal computer and server operating systems, database management systems and security software among the areas under review. More than 15 million commercial users sit across Microsoft’s ecosystem in the UK, according to the CMA’s press release. (assets.publishing.service.gov.uk) The agency said those tools are used by hundreds of thousands of UK businesses and public sector organizations, making the company’s software important to the country’s productivity. ### What exactly is the regulator testing? (gov.uk) The CMA said it will test whether bundling, interoperability limits or default settings make it harder for customers to switch providers and weaken rivals’ ability to compete. The regulator also said it would look at how AI competitors can integrate with Microsoft’s software, framing that as part of whether customers can “mix and match” software and AI services from different suppliers. (gov.uk) The invitation-to-comment document said those issues may arise across collaboration tools, identity and security products, and AI-enabled features embedded into existing workflows. That scope points to the links between older Microsoft franchises and newer AI products, though the CMA has not yet reached any findings. ### How does this connect to the earlier cloud-services fight? (gov.uk) A CMA paper published on March 31 said the agency’s 2025 cloud services market investigation had found Amazon and Microsoft held positions of significant market power. That paper said the cloud inquiry identified limits to customer choice tied to data egress fees, interoperability barriers and Microsoft software licensing on cloud infrastructure. (connect.cma.gov.uk) The same March paper said Amazon and Microsoft were taking steps, after engagement with the CMA, to lower egress fees and improve interoperability for UK customers. But the regulator said it still saw separate issues around Microsoft’s broader business software position, and that led to the decision to open this SMS investigation. ### What does “strategic market status” mean in practice? (assets.publishing.service.gov.uk) The Digital Markets, Competition and Consumers Act 2024 gives the CMA power to designate companies with “strategic market status” in specific digital activities. The Microsoft case page says this investigation is being conducted under Part 1 of that law and will determine whether Microsoft should receive that designation for its business software ecosystem. (gov.uk) The CMA said on March 31 that its digital markets regime lets it use a mix of tools, including SMS designations, conduct requirements and pro-competition interventions. In this case, the May 14 press release said the agency is considering whether action is needed to promote customer choice if it ultimately decides Microsoft has SMS. (gov.uk) ### What happens next, and when? The CMA’s case timetable says the investigation formally began on May 14, 2026, and that customer research is due to start by the end of May. The agency said initial evidence gathering and engagement with Microsoft, customers and other market participants will run from May to July 2026. The CMA’s public call for evidence closes at 11:59 p.m. on June 4, 2026. (gov.uk) The agency said it wants submissions from challenger tech companies, customers, competitors and other interested parties in the UK and internationally. (gov.uk 1) (gov.uk 2)