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Google has urged Britain’s antitrust regulator, the Competition and Markets Authority (CMA), to take action against Microsoft, alleging that Microsoft’s business practices unfairly disadvantage rivals, as revealed in a letter obtained by Reuters.
Both Microsoft and Amazon have been under global scrutiny for their dominance in the cloud computing industry, prompting investigations by regulators in the UK, the European Union, and the U.S.
The CMA initiated an investigation into Britain’s cloud computing sector in October, prompted by a referral from media regulator Ofcom, which highlighted the market dominance of Amazon and Microsoft.
As of 2022, Amazon Web Services (AWS) and Microsoft’s Azure collectively held a 70-80% share of the UK’s public cloud infrastructure services market, according to Ofcom. Google’s cloud division was the closest competitor with a market share of approximately 5-10%.
In the letter to the CMA, Google argued that Microsoft’s licensing practices discouraged customers from using competitor services, even alongside Azure, posing a significant barrier to competition in the UK’s cloud computing market.
Google stated that Microsoft’s licensing restrictions left customers with no economically reasonable alternative but to opt for Azure, despite potential preferences for prices, quality, security, innovation, and features offered by rival services.
Microsoft updated its licensing rules in the previous year to address concerns, aiming to foster competition. However, Google contends that these changes fell short of satisfying competitors.
A Microsoft spokesperson responded, highlighting the company’s collaboration with independent cloud providers to address concerns, emphasizing competition, and noting that more than 100 worldwide providers had leveraged the changes.
Google Cloud Vice President Amit Zavery criticized Microsoft’s practices, asserting his company’s commitment to a multi-cloud approach that allows customers flexibility across different providers based on their requirements.
Google made six recommendations to the CMA, including compelling Microsoft to enhance interoperability for customers using Azure alongside other cloud services and prohibiting the withholding of security updates from those switching providers.
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