U.S. regulators are starting to take a tougher stance against Big Tech companies, following the lead of European lawmakers. While Microsoft has avoided the first of major investigations, the message is clear… big tech is changing and scrutiny will increase. Microsoft president Brad Smith says the company is responding to the change by beefing up its legal and corporate affairs division.
Speaking to Axios, Smith, who also serves as Microsoft’s chief lawyer, says the company will increase the division by 20% over the coming fiscal year. The drive is part of a wider recruitment push by Microsoft that is targeting key areas of its business.
“This reflects a conclusion that this decade will bring expanded tech regulation around the world,” Smith said. “As I sometimes put it inside the company, the 2020s will bring to tech what the 1930s brought to financial services.”
While Microsoft is boosting its legal team to help thwart legal action from regulators, there is another motive. With a wider legal team, the company will be able to better position itself to adhere to regulations and avoid litigations.
“While I think it is easy for people to focus just on antitrust law and just the U.S., what is happening is much bigger and broader than that,” Smith said. “This is a sweeping set of changes. The wise course in our view is to start to prepare what it takes.”
Interestingly, Microsoft’s decisions to increase its legal arsenal comes just as a private agreement with Google to avoid suing each other comes to an end. Microsoft and Google have avoided legal wrangling because they have been participating in a legal truce. This six-year pact is about to come to an end, so the floodgates may open.
Big Tech Investigation
Facebook, Google, Apple, and Amazon are currently all under investigation for anti-trust. Those are Microsoft’s biggest rivals and they are being targeted by five bills presented to the House this month.
Those five bills give regulators more funds to beef up investigations and punishments against offending Big Tech companies. Specifically, there will be a focus on stopping monopolization practices, such as companies buying smaller competitors.
The bills and investigation are aimed at the four companies with criteria they have a $600 billion market cap and over 50 million monthly active users. Interestingly, Microsoft fits the criteria but is not part of the investigation.
Earlier this month a Republican politician called for Microsoft to be included in such an investigation.
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