Google Cloud business vice president Amit Zavery today reportedly accused Microsoft of anti-competitive behaviour in its cloud computing business and said it has complained about the issue to the European Union antitrust regulator, hoping that they start a more in-depth investigation.
This is also the first time Google has publicly commented on Microsoft’s cloud computing behavior. Regarding some of Microsoft’s upcoming agreements with European cloud service providers, Zaffrey believes that these deals do not address broader concerns about Microsoft’s licensing terms. To this end, Google has raised the issue with the EU antitrust agency and urged the EU to conduct a thorough investigation.
In response, Microsoft referred to a blog post the company published last May. At the time, Microsoft President Brad Smith said that Microsoft was No. 2 in cloud services, with a slightly over 20% share of the global cloud services market (based on revenue).
“We are committed to the growth and success of the European cloud community,” a Microsoft spokesperson said.
In the multibillion-dollar cloud computing market, Microsoft and Google are engaged in a fierce competition. Currently, Google lags behind Amazon and Microsoft in this market share.
Microsoft has reached preliminary agreements with some of its smaller European cloud rivals in which it agrees to adjust its cloud computing practices, which in turn will withdraw their earlier antitrust complaints, a person familiar with the matter said.
Obviously, Microsoft’s move is to avoid the EU’s investigation. In March last year, Microsoft’s cloud computing business received complaints from three European competitors, claiming that Microsoft had disrupted fair competition in the cloud computing service market and limited consumer choice. The competitors say Microsoft’s contracts and business practices make its cloud-computing services expensive.
In this regard, Zaffrey said in an interview today: “Microsoft has definitely taken a very anti-competitive stance in the field of cloud computing. They are taking advantage of the dominance of Office 365 and Windows to bundle their Azure and other cloud services in the cloud. Together, it makes it difficult for customers to make a choice.”
“Many of our customers say Microsoft Cloud has bundling practices and restrictions on pricing and licensing that make it difficult for them to choose another provider,” Zeffery said.
Zaffrey also said Microsoft could only benefit from individual deals with several smaller European cloud providers. “They’re selectively buying out those who complain, rather than making the terms available to everyone,” Zeffery said.
“My point with the regulators is that they should look at the issue holistically, and even if one or two suppliers might settle, it doesn’t address the broader issue,” Zeffery said.
Finally, Zeffery also refuted the claim that “this issue is just a spat between Google and Microsoft.” “It’s not a question of ‘Does Google have anything to do with’? It’s a question of ‘cloud.’ The cloud allows you to deploy software in an open, flexible way, giving customers more choice, and It’s easier to run these software anywhere.”
