The Moment of Truth Has Come for Microsoft, Which Wants to Be Seen As the “Mister Nice Guy” of Tech.
Big issues will test Microsoft's influence strategy in the coming months.
Nothing matches the zeal of a convert. When it comes to antitrust and regulation of large high-tech companies, Microsoft is no longer the pariah condemned in 2004 by the European Union for imposing its software on the then dominant Windows operating system. Nor does the Redmond-based company want to appear as the one that the American justice threatened twenty-two years ago to split into two separate companies to prevent its “predatory” practices on the Internet browser market.
From now on, Microsoft plays the role of “Mister Nice Guy” in the tech industry.
At least for those who compare it to Facebook, Google, or Amazon. When these companies defend themselves or apologize from hearing to hearing before elected officials in the United States, France, the United Kingdom, or Brussels, the Redmond-based company never misses an opportunity to show its goodwill.
UK regulator threatens Activision takeover
Behind the scenes, its spokespeople go so far as to suggest regulations that could affect, albeit minimally, the group's profits. Publicly, the company changed its software licensing terms at the end of August 2022 to open up the market a little more to its European competitors in the cloud market.
After a complaint from the French OVHcloud, the mere possibility of an investigation on the subject made him change his mind. But it is now the moment of truth for this strategy of influence to be credited for more than ten years to Brad Smith, the president of Microsoft, sometimes presented as the number two of the group after Satya Nadella.
In Europe, the domination of Amazon and Microsoft in the very strategic market of online data hosting raises questions for competition authorities. In addition, Microsoft will be affected by the antitrust rules being implemented by the European Commission's recent Digital Markets Act.
Microsoft's pending $75 billion takeover of video game publisher Activision is also under scrutiny around the world. At the beginning of September 2022, the British competition authority told Microsoft that it would give it five days to convince it not to open an in-depth investigation (phase 2) on this operation, which would be the biggest in the history of video games.
Unlike its rivals, whose proactivity with decision-makers remains mostly in the shadows, Microsoft had already made it known when the takeover was announced that Activision's star games, such as “Call of Duty”, would continue to be available to owners of PlayStation consoles, the rival of its Xbox.
The first win for Microsoft
In the United States, this strategy has already given Microsoft strong allies. If some Senators are worried, the most prominent Republican elected to the House of Representatives on these competitive issues has already given his support to the project with Activision. “This acquisition still has to go through a legal review by the Federal Trade Commission and the Department of Justice, but the assurances I've received from Microsoft are encouraging,” tweeted Ken Buck, one of the most vocal critics of Big Tech in the House of Representatives, just hours after the deal was announced:
According to the Wall Street Journal, the tweet came after a call from Brad Smith's teams. And a few months earlier, the Microsoft president had blasted the elected official with tough questions to ask Google and Facebook at public hearings. While the antitrust world is increasingly questioning the wisdom of letting Facebook buy Instagram and WhatsApp, being able to consider such a tie-up with Activision is already a victory for Microsoft.
To move forward with its strategy, Microsoft hopes to be able to continue to build on its image as a good student of tech, whose practices are different from those of Facebook, Google, or Amazon.
We will see very soon if this will be enough for Microsoft.
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