- CMA given nine months to determine whether Microsoft has a Strategic Market Status
- The company has 15 million commercial users in the UK, including in the public sector
- Software mixing and third-party tool integration are at the core of the investigation
The UK's Competition and Markets Authority (CMA) has launched an investigation into Microsoft's business software to determine whether the American tech giant has excessive market power in the country.
Competition, consumer choice, innovation and pricing are all set to be analyzed in the Strategic Market Status (SMS) investigation.
Britain's investigation comes at an important point, with Microsoft now holding more than 15 million commercial users across the UK including across public sector organizations.
CMA SMS investigation into Microsoft hits full speed
Software is undergoing a major change as copilots and AI assistants get embedded and many businesses even turn to fully autonomous, agentic workflows. With this, the CMA wants to ensure that customers can still mix and match software from different vendors and integrate third-party AI into Microsoft's suite to prevent vendor exclusivity and lock-in.
Regulators have expressed concerns over the way Microsoft bundles its products as well as interoperability restrictions that make it challenging, expensive or impossible to integrate third-party tools and software.
"Our aim is to understand how these markets are developing, Microsoft’s position within them and to consider what, if any, targeted action may be needed to ensure UK organisations can benefit from choice, innovation and competitive prices," CMA CEO Sarah Cardell explained.
If Microsoft is deemed to have too much control over the market, the CMA could impost interoperability requirements, bundling restrictions and other measures.
As for the next stages, the CMA plans to work with rival software vendors, challenger companies, enterprise customers and public sector organizations to get a clearer picture of the market.
"We are committed to working quickly and constructively with the CMA to facilitate its review of the business software market," a Microsoft spokesperson said.
The CMA says its nine-month investigation will be "proportionate and transparent," and that a final decision on whether to designate Microsoft with SMS will be made by February 2027.
