Google Takes Aim at Microsoft's Azure Cloud Practices

Google has filed a complaint with the European Commission, alleging that Microsoft is engaging in anti-competitive practices by locking customers into its Azure cloud platform. According to Google, Microsoft is using its dominant position in the market with the Windows Server operating system to stifle competition.

The complaint references a 2023 study indicating that European businesses and public sector entities are paying up to €1 billion annually in licensing penalties associated with Microsoft products. This move highlights ongoing tensions between major tech companies and raises questions about competition and market practices in the cloud services sector.

In a recent blog post, Google accused Microsoft of imposing a 400% markup on customers who continue to run Windows Server on competing cloud platforms. Amit Zavery, Vice President and head of Google Cloud Platform, emphasized that regulatory action is necessary to eliminate Microsoft's vendor lock-in practices, allowing customers greater choice and fostering a more level playing field for competitors in the cloud computing market. This statement underscores Google’s ongoing efforts to challenge Microsoft's dominance and advocate for fair competition in the industry.

Google's complaint against Microsoft cites research indicating that European businesses and public sector organizations collectively spend up to €1 billion annually to run Microsoft software in non-Azure cloud environments. In response, Microsoft’s president, Brad Smith, argued that a prior deal has addressed previous concerns and bolstered competition.

Additionally, in July, Microsoft reached a €20 million settlement regarding similar antitrust issues related to its cloud computing licensing practices with CISPE, successfully averting action from the European Commission. Microsoft's cloud practices are also currently under scrutiny by the UK’s Competition and Markets Authority, highlighting ongoing regulatory challenges the company faces in Europe.

Amit Zavery emphasized the urgency of the situation, stating, "The time to act is now." He warned that the cloud market could become increasingly restrictive if regulatory changes do not occur promptly. Google argues that taking regulatory action is essential to preventing Microsoft's current policies from stifling competition and ensuring a level playing field in the cloud services market. This perspective underscores the search giant's commitment to fostering a more competitive environment for cloud computing.