Google accuses Microsoft of hindering cloud competition in EU complaint

Dive Summary:

• Google has accused Microsoft of hindering cloud competition in the European Union and has filed a formal complaint with the European Commission. In an announcement on Wednesday.
• “Microsoft’s licensing terms restrict EU customers from moving existing Microsoft workloads to competitors’ clouds (despite no technical impediments to doing so) or impose a stunning 400% price increase, as Microsoft has admitted,” Google said.
• Microsoft reached a similar agreement Legal action filed by Cloud Infrastructure Service Providers in Europe In July, the EU offered a series of concessions to the cloud consortium. As part of the agreement, CISPE gave Microsoft nine months to ease software licensing restrictions and allow European cloud providers to host various Azure services.

Diving Insight:

Microsoft continues to fight accusations of anti-competitive business practices in many jurisdictions.

The software giant suffered a regulatory setback in June when the European Commission issued its preliminary ruling. Microsoft violated EU antitrust laws By bringing Teams together with Office 365 and Microsoft 365.

Approximately at Microsoft’s disposal one quarter of the global cloud marketIt pre-separated its global collaboration tool from its corporate productivity suites in April, following its launch in the European Economic Area and Switzerland eight months ago.

Google, the third-largest hyperscaler behind Microsoft and market leader AWS, is no stranger to cloud conflicts. The outline of Google’s EU complaint is a Federal Trade Commission’s cloud market competition investigation Opened in March 2023.

“A small number of legacy on-premises software providers, such as Microsoft, Oracle and others, are using their strong positions in non-cloud markets such as productivity software, server operating systems and applications, and desktop operating systems to give their cloud products an unfair advantage and lock customers into their cloud ecosystems.” Google told the FTC in June 2023:.

A similar regulatory clash is taking place in the UK, with Ofcom referenced to the public cloud infrastructure market applied to the Competition and Markets Authority for further investigation last year. The CMA raised concerns in May Barriers to multi-cloud adoptionIncluding exit fees, discount incentives, and restrictive software licenses.

AWS, Microsoft and Google exit fees removed For some workloads earlier this year.

Google criticized Microsoft for its 2019 software licensing changes that “impose excessive financial penalties on businesses that want to use Windows Server software on Azure’s closest competitors, such as Google Cloud and AWS,” the company announced Wednesday.

According to Google, “Microsoft has introduced additional hurdles over the past few years for those choosing to run Windows Server on competitors’ cloud platforms, such as limiting security patches and creating other interoperability barriers.”

Microsoft tells UK CMA that software licensing fees “do not significantly increase costs for competitors” According to the minutes of the July hearing.

The company said it did not believe the new claims would gain traction in the EU.

“Microsoft has amicably resolved similar concerns raised by European cloud providers, although it hopes Google will continue to pursue litigation,” a company spokesperson said in an email Wednesday. “Just as we have failed to convince European companies, we expect Google to fail to convince the European Commission.”