What you need to know
- Google recently claimed that Microsoft's cloud business is participating in anticompetitive practices.
- The crux of the argument is that Microsoft allegedly uses the dominance of Office 365, Windows, and on-premise business to get businesses to use Azure through bundling.
- Microsoft has agreed to make changes to appease multiple smaller cloud vendors in Europe, but Google claims the changes are not significant enough.
- A separate EU antitrust complaint by CISPE is still ongoing against Microsoft.
Google has come out against Microsoft's cloud business, claiming that Microsoft is participating in anticompetitive practices. A report by Reuters breaks down Google's stance and includes comments from Vice President of Google Cloud Amit Zavery.
The news comes just two days after Reuters reported that Microsoft offered to change its cloud practices to appease several small European vendors. Google is not satisfied with those changes. In fact, it argues that Microsoft making deals with specific vendors is evidence of market dominance, not proof that Microsoft has made genuine changes.
"Microsoft definitely has a very anti-competitive posture in cloud. They are leveraging a lot of their dominance in the on-premise business as well as Office 365 and Windows to tie Azure and the rest of cloud services and make it hard for customers to have a choice," said Zavery.
He added, "when we talk to a lot of our customers, they find a lot of these bundling practices, as well as the way they create pricing and licensing restrictions, make it difficult for them to choose other providers."
That definitely makes it an unfair advantage to Microsoft and ties the people who complained back to Microsoft anyway.
Amit Zavery, VP of Google Cloud
When speaking with Reuters, Microsoft referenced a blog post from May 2022 and a spokesperson shared a statement. "We are committed to the European Cloud Community and their success."
Earlier this week, it was reported that Microsoft offered to change its cloud practices. The move was made to stave off antitrust complaints made by several small vendors. Reuters specified that the complaints came from French cloud computing services provider OVHcloud, Italian cloud service provider Aruba, and a Danish association of cloud service providers.
Microsoft reportedly introduced changes in October 2022 in response to feedback from cloud providers in Europe.
Google's Zavery argued that Microsoft striking deals with small vendors were an indicator of dominance.
"They're selectively kind of buying out those ones who complain and not make those terms available to everyone. So that definitely makes it an unfair advantage to Microsoft and ties the people who complained back to Microsoft anyway," he said.
Zavery called for a holistic approach that addresses the sector as a whole rather than individual vendors.
Google and Microsoft are rivals in several sectors, but Zavery claims recent statements are not just about Google.
"The question is not about Google. I just want to make it very clear. It's the cloud," said Zavery. "The premise with cloud was to have an open, flexible way to deploy your software and have customers more choices so that they can run their software in any place they choose to in a much more easy way."
