LONDON – Google has urged Britain’s antitrust regulator to take action against Microsoft, accusing the tech giant of engaging in unfair business practices that put rivals at a significant disadvantage. The call for action comes as Microsoft and Amazon face increasing scrutiny worldwide over their dominance in the cloud computing industry, prompting regulators in Britain, the European Union, and the United States to investigate their market power.
The Competition and Markets Authority (CMA) initiated an investigation into Britain’s cloud computing sector in October after media regulator Ofcom raised concerns about Amazon and Microsoft’s market dominance. According to Ofcom, Amazon Web Services (AWS) and Microsoft Azure held a combined 70-80% share of the country’s public cloud infrastructure services market in 2022, while Google’s cloud division lagged behind with a market share of approximately 5-10%.
In a letter submitted to the CMA, Google argued that Microsoft’s licensing practices discouraged customers from using competitor services even as secondary providers alongside Azure. Google claimed that UK customers were left with no economically viable alternative but to use Azure, despite potentially preferring the prices, quality, security, innovations, and features offered by other cloud service providers.
Google asserted that such practices directly harmed customers and represented the only significant barrier to competition in Britain’s cloud computing market. Microsoft had made changes to its licensing rules last year in an attempt to address these concerns and promote competition, but Google and other rivals were not satisfied with the outcome. Microsoft declined to comment on the matter.
Amit Zavery, Vice President of Google Cloud, criticized Microsoft’s practices, emphasizing his company’s commitment to a multi-cloud approach that enables customers to seamlessly switch between providers based on their needs. Zavery expressed concern over the potential negative impact on innovation and investments if barriers to competition in the cloud computing market remain.
The focus of Google’s complaint is Microsoft’s decision to update the terms for customers using their Windows or other software licenses in the cloud, which effectively increases costs for those who choose Google or AWS over Azure. When asked why Amazon, with a larger market share than Microsoft, does not pose a similar anticompetitive risk, Zavery explained that AWS consumers are not facing the same restrictions and that issues related to cloud interoperability can be resolved through discussions between providers.
In its letter to the CMA, Google made several recommendations, including the improvement of interoperability for customers using Azure alongside other cloud services and the prohibition of Microsoft from withholding security updates from customers who switch providers.
The CMA has not yet responded to requests for comment on the matter.
Overall, Google’s call for antitrust action against Microsoft in the UK cloud market highlights the ongoing battle for dominance in the industry and the concerns surrounding potential barriers to competition. As regulators examine the practices of leading cloud service providers, the outcome of these investigations could have significant implications for the future of the market and the choices available to customers.
