This week, the European Commission launches a series of Digital Markets Act (DMA) compliance workshops with the gatekeepers: Microsoft, Amazon, Apple, Alphabet, Bytedance (TikTok), and Meta—listed in chronological order according to their scheduled sessions.
Let’s start with Microsoft, whose workshop is set for June 20. Currently, the company is attempting to settle a case related to the bundling of Teams with its Office products. Under the DMA, Microsoft has been designated a gatekeeper for core services including Windows PC OS and LinkedIn.
It is no secret that regulators have a difficult task with gatekeepers: identifying problematic behaviour, assessing its legality, and crafting workable remedies. But regulators need to look at companies’ incentives to understand why companies like Microsoft often push the boundaries of compliance. Their incentives are clear: every delay or workaround can help to cement its position and achieve their quarter estimates.
Unless enforcers embrace more innovative solutions, outcomes will be “the best we can get with the tools we have”. A result that is better than nothing, but still far from ideal.
The role of economic incentives
For a company like Microsoft, the rewards of stretching compliance can outweigh the risks—if done carefully. Let’s crunch some numbers. Azure and other cloud services are projected to grow 33–35% in 2025, pushing annual revenue past $130 billion, making it Microsoft’s fastest-growing business.
The economic logic is simple: where growth is strongest, the incentive to move fast and expand your position is highest. So long as enforcement remains predictable and manageable, pushing the limits—without triggering structural remedies—can seem like a smart bet.
Cloud is on track to become Microsoft’s most lucrative business line, and any regulatory drag could weigh heavily on its long-term earnings. That’s why Microsoft has every incentive to resist regulatory threats—such as the UK CMA’s ongoing investigation into cloud infrastructure—but without crossing the line into clear antitrust violations. A tough remedy could mean losing share to AWS or Google, a risk Microsoft cannot afford in such a critical market.
Do you know what’s the next fastest-growing segment? Search and News advertising, up 21% last quarter, with Microsoft forecasting another 21–23% increase next quarter. This momentum is driven by Bing, Edge, and Microsoft’s ad services—precisely the areas the European Commission reviewed but ultimately excluded from DMA gatekeeper obligations.
This isn’t a critique of the EU’s legal reasoning, but rather a reminder that economic incentives often run ahead of regulatory frameworks. For context, LinkedIn—a designated core platform under the DMA—is growing at just 8%. At this rate, Search and News could soon outpace LinkedIn in revenue, while remaining outside the scope of DMA enforcement.
This helps explain Microsoft’s incentive to push cloud, search, browser, and advertising services as aggressively as possible before new regulatory oversight catches up. The stakes are high. A mere 1% slowdown in cloud growth due to future compliance obligations could cost Microsoft around $280 million per quarter, or over $1 billion annually. In the case of Bing and Edge, even small “nudges” that preserve default settings may be generating meaningful gains. If such practices are driving just an extra 1% in revenue, Microsoft could be looking at $125 million annually at risk (based on Search and News Ads 2024 annual data). That’s a powerful incentive to keep a pop-up window or three warnings to users to stick with Microsoft’s defaults. It is not surprise that some of Edge’s rivals, like Vivaldi and Opera, have been so vocal about Microsoft’s practices and the financial impact of browser choice.
Teams: A cautionary tale
Microsoft has experience navigating these muddy waters. The European Commission opened a formal investigation into Microsoft in 2023, following a 2020 complaint from Slack. It found that Microsoft abused its dominant position in the market for SaaS productivity applications by tying Teams to its Office suite since at least April 2019.
The strategy worked. During the bundling period, Teams’ user growth surged, far outpacing the more modest trend seen before and after. Microsoft’s estimated revenue from Teams reached $8 billion annually, totaling around $30 billion from 2020 to 2023—up from less than $1 billion before the tie-in.
Slack and Microsoft Teams users 2017 to 2023 (mm)
In a fast-growing market, establishing early dominance was key. Even if Microsoft now faces mild remedies, the calculation likely paid off: take the risk early, scale fast, and accept the regulatory cost later.
Infringements are becoming more subtle
As Big Tech adapts to regulatory scrutiny, exclusionary practices are becoming more nuanced. We’re moving away from traditional abuses—like refusal to supply or straightforward tying—toward dark patterns and interface nudges designed to keep users in your ecosystems.
In recent weeks, the US FTC sued Uber over practices that made it harder for users to cancel memberships, while Italy’s competition authority fined Poste Italiane for aggressive tactics to push users to accept certain terms and conditions. Despite different contexts, both cases involved a series of pop-ups, messages, and interface prompts that steer consumer behavior.
These subtle tactics are likely to become more common—and more difficult for regulators to detect and address.
Ironically, the Digital Markets Act (DMA) may have made subtle infringements harder to police. First, the line between what counts as a harmless nudge and an illegal design choice is often blurred. Second, the same practice may trigger regulatory action or not depending on the number of business users a platform has.
This creates room for inconsistencies—even borderline absurd outcomes, but somehow legally valid. Take Microsoft Edge. In its decision not to designate Edge as a core platform under the DMA, the Commission noted:
“The assessment is based on the current facts and the situation of Edge at the point of this decision. However, the results of the market investigation showed that there may be potential for Edge becoming a more important browser for business users…”
In short: not now, but maybe later. Combine this with the strong economic incentives we outlined earlier, and the path becomes clear: push Edge and Bing aggressively now, gain market share, and deal with the regulatory consequences later—if and when they come. And if they do, a difficult question will follow: why wasn’t this addressed sooner?
Interim Measures
The obvious answer to the previous question is, “the law is the law”—and this article doesn’t aim to debate whether the DMA is a perfect tool.
Still, there’s a practical question regulators should be asking: why not make greater use of interim measures?
The European Commission rarely invokes them, despite France and Belgium showing in recent years that it can be done without disaster. Interim measures may be the only tool that truly shifts corporate incentives—forcing Big Tech to engage in talks or comply before the damage is done. As noted earlier, when you’re forecasting 20–30% revenue growth, the only credible threat is one that interrupts that revenue stream.
Are interim measures easy to impose? No. Can they be overturned in court? Yes. But when one of the most risk-averse actors (regulators) is trying to constrain some of the most risk-tolerant companies in the world, some degree of calculated risk is necessary—or the battle is lost by default.
Regulators: What if we act and we’re wrong in five years?
Companies: What if we don’t act and we’re out in five years?
