UK watchdog wants to know why Microsoft dominates software market

Microsoft reportedly makes it harder for customers to integrate its software with other applications.

Microsoft logo and text on a dark red background

Microsoft has come under scrutiny from the UK's Competition and Markets Authority (CMA) over its dominance in the software market. The CMA aims to determine how Microsoft’s market dominance affects UK businesses and whether the company allows users to seamlessly integrate its software with other applications.

The CMA’s recent Strategic Market Status (SMS) investigation into Microsoft’s software business was reportedly prompted by complaints from UK customers, who claimed that Microsoft does not allow them to effectively combine its software with products from other providers. As a result, they may be prevented from accessing the best available deals.

“The CMA’s investigation will examine whether Microsoft has SMS in business software and consider whether it can use that position to limit customer choice,” the CMA added. “It will assess whether bundling of products, limits in interoperability or default settings can prevent customers switching and weaken the competitive constraints Microsoft faces from rivals.”

One aspect of the investigation is to assess how Microsoft allows AI competitors to integrate with its software. Additionally, a wide range of Microsoft products, including productivity software, PC and server operating systems, database management systems, and security software, will be examined.

Designating Microsoft as a Strategic Market Status (SMS) company would also allow the CMA to launch a broader investigation into the company’s cloud business in the UK.

Sarah Cardell, Chief Executive of the CMA, said that hundreds of thousands of customers in the UK rely on Microsoft’s systems, and that business software is a cornerstone of the country’s economy.

Back in March, the CMA also launched an investigation into the UK cloud businesses of Microsoft and Amazon, a move that led to lower fees for UK-based businesses. Microsoft maintains a strong presence in the UK, with the CMA estimating that the Redmond-based software giant has up to 15 million commercial users in the country.