Microsoft must face stricter antitrust monitoring

Microsoft Corporation will be subject to more intensive supervision by the German Federal Cartel Office "Bundeskartellamt" in the future. Together with its subsidiaries, the company is subject to the extended abuse supervision of the Act against Restraints of Competition (Section 19a GWB). The Bundeskartellamt can prohibit companies with "paramount cross-market significance for competition" from engaging in practices that threaten competition, the federal authority announced on Monday.

The decision applies to the entire company, not just to individual services or products, according to the press release. Within the EU, Microsoft is already defined as a so-called gatekeeper and must adhere to the guidelines of the Digital Markets Act (DMA). However, this currently only applies to the Windows operating system and the LinkedIn network, The President of the Bundeskartellamt, Andreas Mundt, explains. The Bundeskartellamt's finding now gives it additional scope for action: "Based on our decision, we can prevent practices that threaten competition where the DMA does not apply," says Mundt.

Developments must be geared towards Microsoft

The company not only dominates the market with the Windows operating system, but also has a strong position of power in server operating systems and production software such as Office products. The company also plays a leading role in the cloud with Azure alongside Amazon Web Services (AWS). Acquisitions and in-house developments have also expanded the offering. The company benefits from its open system through the integration of third-party offerings. "However, it retains a considerable advantage over competitors that are only active in individual submarkets due to the range-like bundling of complementary offerings," argues the Bundeskartellamt. "Added to this is the overarching technical integration of the products from the Microsoft ecosystem."

Microsoft's products are the standard in business, administration and among private individuals and are an essential part of companies' IT infrastructure. Accordingly, software developers are dependent on their developments being compatible with Microsoft products and must orient themselves to the company's framework conditions. "Often, Microsoft plays a dual role, as the company not only sets the framework for third-party developers, but also acts as their competitor," the Bundeskartellamt explains.

Other companies already specified

The decision is valid for five years. The Federal Cartel Office has not yet decided to initiate possible proceedings against Microsoft. Since the beginning of 2021, the Federal Cartel Office has been able to take early and more effective action against the behavior of large digital groups. Companies with paramount cross-market significance already include Alphabet/Google, Meta/Facebook and Amazon. Apple should also be one of them. However, there is still an appeal pending before the Federal Court of Justice.

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