Microsoft Cloud Service Under Scrutiny From EU Antitrust Arm

(Bloomberg) — Microsoft Corp.'s Azure cloud business has been targeted by the European Union's antitrust arm, amid concerns the US software firm is leveraging its market power to squeeze out rivals.

As part of an informal probe, regulators are quizzing competitors and customers about how Microsoft may be abusing its access to business-sensitive information belonging to cloud firms it has commercial dealings with, according to documents seen by Bloomberg.

EU antitrust enforcers want to know whether Microsoft then leverages such confidential information to compete with cloud-service providers on the market, said two people familiar with the matter, who spoke on condition of anonymity.

The EU's escalation follows on the heels of a series of complaints from cloud firms over Microsoft's behavior — including CISPE, an industry group with links to Amazon.com Inc.'s Amazon Web Services. The scrutiny of cloud competition coincides with Microsoft's efforts to convince regulators around the world to approve its $69 billion acquisition of Activision Blizzard Inc., publisher of blockbuster game Call of Duty. The European Commission, the EU watchdog, on Monday conditionally approved the tie-up, just weeks after the UK's competition authority vetoed it.

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Respondents to the commission's questions have until May 16 to respond, and have also been asked to submit non-confidential versions of their evidence by the end of the month — often a signal that a formal antitrust investigation is in the works.

Opening a formal probe would then kick off a process that could eventually lead to fines — though regulators can settle probes before they get to that stage, or drop cases if their initial concerns don't stack up.

Earlier complaints came from French firm OVH Cloud, Italian outfit Aruba, a Danish Cloud Association, and Nextcloud, a German cloud provider.

“The commission has received several complaints regarding Microsoft, including in relation to its product Azure, which we are assessing based on our standard procedures,” the regulator said in an email.

Microsoft didn't immediately respond to requests for comment.