The FTC also highlighted the fees charged to users who transfer data from certain cloud systems, and minimum spend contracts, which offer discounts to companies in exchange for a certain level of spending.
Microsoft has also faced criticism from international regulators over similar matters. Britain's Competition and Markets Authority is investigating Microsoft and Amazon after fellow watchdog Ofcom found customers complaining of being 'locked' to a single provider, which offers discounts for exclusivity and charges high 'outgoing fees' to leave.
In the EU, Microsoft has avoided a formal investigation into its cloud operations after striking a multimillion-dollar deal with a group of rival cloud providers in July.
The FTC filed a lawsuit in 2022 to block Microsoft's $75 billion acquisition of video game maker Activision Blizzard over concerns that the deal would hurt competitors of its Xbox consoles and cloud gaming businesses. A federal court rejected an FTC attempt to block it, which was appealed. A revised version of the deal was meanwhile completed last year after approval by the British CMA.
Since its inception two decades ago, cloud infrastructure and services have become one of the most lucrative business lines for Big Tech, as companies outsource their data storage and computing online. More recently, this has increased due to the demand for processing power to train and run artificial intelligence models.
Spending on cloud services rose to $561 billion in 2023, with market researcher Gartner predicting it will grow to $675 billion this year and $825 billion by 2025. Microsoft has a market share of around 20 percent of the global cloud market, behind leader Amazon Web Services, which is 31 percent, but almost double the size of Google Cloud at 12 percent.
There is fierce rivalry between the trio and smaller providers. Last month, Microsoft accused Google of waging “shadow campaigns” to undermine its standing with regulators by secretly funding hostile lobby groups.
Microsoft also alleged that Google tried to derail the settlement with cloud providers in the EU by offering them $500 million in cash and credits to reject the deal and continue the lawsuits.
The FTC and Microsoft declined to comment.
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