Amit Zaveri, Google Cloud general manager and vice president, and Tara Brady, president of EMEA, argued in a blog post that Microsoft’s practices have caused significant harm to European businesses and governments. Google estimates the resulting damage to be at least 1 billion euros per year, saying it wastes taxpayers’ money, hinders competition and exposes customers to greater risk from Microsoft’s inadequate security culture.
Dispute settlement with CISPE, excludes large clouds
Microsoft has been accused for years of hindering competition in the cloud market through its licensing and pricing practices. In November 2022, the Association of Cloud Infrastructure Service Providers of Europe (CISPE) formally filed a complaint against Microsoft to the European Commission’s Directorate General for Competition (DG COMP) after failing to resolve the dispute amicably.
At the time, a key issue was Microsoft linking its products, such as Microsoft 365 and Windows, with Azure cloud services and other services. CISPE criticized Microsoft for making it nearly impossible to compete with its SaaS services. Microsoft can always offer software cheaper on its Azure cloud than on competing clouds.
They also criticized the fact that Microsoft’s software does not work properly on other clouds, hindering competition. CISPE concluded that Microsoft is abusing its dominant market position to undermine fair competition and limit consumer choice in the cloud services market.
In July of this year, CISPE and Microsoft resolved the dispute through an agreement. Microsoft promised to make certain changes within nine months to resolve the allegations raised by CISPE, and CISPE will accordingly withdraw its complaint against Microsoft. However, among CISPE member companies, AWS, Google Cloud Platform, and Alicloud were explicitly excluded from this agreement.
“Unfortunately, instead of changing its practices, Microsoft signed one-off deals with a small number of companies,” said Google’s Zaveri and Brady. Furthermore, he said, “We will file a formal complaint with the European Commission.”
Google failed to persuade small and medium-sized European cloud companies
Microsoft did not elaborate on Google’s accusations in an emailed statement. Instead, “Microsoft amicably resolved similar concerns raised by European cloud service providers even after Google anticipated that the lawsuit would continue.” Google filed a $470 million settlement with CISPE this summer to continue its litigation against Microsoft. A Microsoft spokesperson reportedly suggested 10,000 euros, pointing out that Google, which failed to persuade European cloud service providers, will also fail to persuade the European Commission.
Dave McCarthy, IDC’s vice president of cloud and edge services research, interprets Google’s complaint as a sign of “a general trend in the cloud industry to rethink how customers build applications in the cloud and who they work with.” Competition is becoming more intense, and while AWS and Azure’s growth is slowing, Google is growing rapidly.
McCarthy expressed doubts whether Microsoft’s strategy would succeed. In the short term, it may be effective to provide incentives for customers to continue using Azure. But in the long run, this practice can backfire by encouraging customers to exclude these technologies from their IT assets in order to have more choices in the future.
On the other hand, Tracy Wu, senior cloud analyst at Forrester, is unimpressed by Google’s complaints, describing them as “excessive whining.” Wu said he is annoyed by Microsoft, which does not cooperate with the company even though Google gets along well with AWS. “Google is the most difficult to cooperate with among the large clouds. “They don’t share their roadmap and their data is not the most open,” he pointed out.
Dennis Kipker, research director at cyberintelligence.institute, welcomes antitrust action against Microsoft. “Microsoft has repeatedly used complex licensing systems and restrictive practices to force customers into its cloud ecosystem,” Kipker said, noting that Microsoft has always cleverly avoided scrutiny from regulators. He also added, “ “This pattern of behavior goes back decades and has caused great harm to national innovation and digital sovereignty,” he added.
Therefore, it is right that steps are now taken to break this vicious cycle. Regulators around the world must act decisively to collectively stop Microsoft’s exclusive product policies.
editor@itworld.co.kr
Source: www.itworld.co.kr
