Alphabet’s Google Cloud has publicly accused Microsoft of engaging in anti-competitive practices in the cloud computing market, specifically criticizing deals Microsoft has struck with several European cloud vendors. Google Cloud’s Vice President Amit Zavery has urged European Union antitrust regulators to scrutinize these deals, stating that they do not address broader concerns about Microsoft’s licensing terms.
In response to Google Cloud’s accusations, Microsoft pointed to a blog post from May last year in which the company’s president, Brad Smith, claimed a “healthy number two position” in the global cloud services market with just over 20% of the revenue share. A Microsoft spokesperson also reaffirmed the company’s commitment to the European Cloud Community and its success.
Cloud computing has become a fiercely competitive, multi-billion-dollar industry, with Google trailing behind market leaders Amazon and Microsoft. Recently, the sector has attracted increased regulatory attention in the United States and the United Kingdom due to the dominance of a few key players and the critical role of cloud services in modern business.
Microsoft has proposed changes to its cloud computing practices in a deal with a few smaller rivals, who will suspend their antitrust complaints in return. This deal is expected to prevent an EU investigation into the matter. However, Zavery has argued that Microsoft’s anti-competitive behavior extends beyond the cloud, stating that the company leverages its dominance in on-premise business, Office 365, and Windows to tie Azure and other cloud services together, making it difficult for customers to choose other providers.
Zavery has also criticized Microsoft’s individual deals with smaller European cloud vendors, claiming that they only benefit Microsoft and create an unfair advantage for the company. He urges regulators to look at the issue holistically, as settling with one or two vendors does not solve the broader problem.
The European Commission has declined to comment on the issue. Microsoft still faces another EU antitrust complaint from CISPE, a trade group that includes Amazon as a member. CISPE has rejected Microsoft’s proposed changes to its cloud computing practices.
Dismissing the idea that the issue is simply a disagreement between Google and Microsoft, Zavery emphasizes that the primary concern is the open, flexible nature of cloud computing, which should offer customers more choices and the ability to run their software in any location they choose.