Google Cloud CEO: Microsoft ‘buys off plaintiffs’ after antitrust ruling – Cloud

Google Cloud CEO: Microsoft 'buys off plaintiffs' after antitrust ruling

Amit Zavery, Google Cloud

Google Cloud is slamming rival Microsoft after the company reached a multimillion-dollar settlement over European antitrust violations related to its cloud computing licensing practices.

“The way Microsoft bribes complainants instead of addressing the substance of their complaint is hurting businesses and should not be defrauded,” Amit Zavery, general manager, vice president and head of Google Cloud Platform, told CRN US in an email.

“Multiple regulatory agencies have launched investigations into Microsoft’s licensing practices, and we hope that remedies will be developed to protect the cloud services market from Microsoft’s anti-competitive behavior.”

In late 2022, Cloud Infrastructure Services Providers in Europe (CISPE) filed a complaint with the European Commission, alleging that Microsoft’s new contractual terms of October 1 would harm the European cloud ecosystem.

On Wednesday, CISPE said it had resolved the issue and withdrawn its complaint to the European Commission.

Microsoft to reward CIPSPE members and develop new product

Under the agreement, Microsoft will compensate CISPE members for lost revenue related to cloud computing license costs over the past two years.

The Redmond, Washington-based software and cloud giant also said it will develop a product that will enable CISPE members to run Microsoft software on their platforms on Azure cloud infrastructure at prices on par with Microsoft.

Microsoft CEO Brad Smith said that after more than a year of working with CISPE and its European members, he was pleased Microsoft had resolved the issue.

“Not only have we addressed their past concerns, but we have also worked collaboratively to define a path forward that will bring even more competition to the cloud computing market in Europe and beyond,” Smith said in a statement.

Microsoft representatives declined to comment on Google Cloud.

Google Cloud: We Will “Continue Fighting Microsoft Licensing”

Google Cloud representatives said that regardless of CISPE’s decision, Google will continue to fight Microsoft’s licensing approach, which they say is unfair.

“We are exploring further options to combat Microsoft’s anti-competitive licensing practices to promote choice, innovation and the growth of the digital economy in Europe,” Google’s Zavery said.

Google Cloud further stated that the settlement does not apply to all CISPE members and appears to violate CISPE’s “red lines” set out at the beginning of the settlement negotiations.

In an email to CRN US, Google said these “red lines” include: any agreement must be principles-based and apply to all cloud infrastructure providers operating in Europe.

In addition, any agreement must benefit all customers in Europe, and every company must have the right to run licensed software in the cloud of its choice without financial or technical penalties.

Finally, Google emphasized that any CISPE agreements must be transparent and clear, verifiable, resilient to change, and capable of being verified for compliance in the long term.

Google, Microsoft and Amazon Cloud Market Shares

In the first quarter of 2024, AWS, Microsoft, and Google Cloud had a combined 67 percent share of the global cloud services market.

Enterprise spending on cloud infrastructure services totaled well over $76 billion in the first quarter of 2024, up $13.5 billion, or 21 percent, year-over-year.

AWS is the world leader in cloud services with a 31 percent global market share, followed by Microsoft with a 25 percent share, and Google with an 11 percent share.

Other leading global cloud companies—such as IBM, Oracle, VMware, Tencent, and Huawei—have around 1 to 2 percent market share.

Microsoft increased its market share more than any other company — from 22 percent in Q1 2022 to 25 percent in Q1 2024.