Google Challenges Microsoft's Cloud Practices in EU Complaint

Alphabet Inc.'s Google has filed a complaint with the European Commission against Microsoft's alleged anti-competitive practices in the cloud computing market. The complaint highlights Microsoft's exploitation of its dominant Windows Server operating system to lock customers into its Azure cloud platform, preventing competition.

Google Cloud Vice President Amit Zavery revealed that Microsoft charges customers a 400% markup to keep running Windows Server on rival cloud operators. Additionally, users of alternative cloud systems receive later and more limited security updates. A 2023 study by cloud services organization CISPE estimated that European businesses and public sector bodies are paying up to 1 billion euros ($1.12 billion) per year on Microsoft licensing penalties.

Google argues that Microsoft has locked customers into using collaboration application Teams, even when they prefer alternatives, and is employing the same tactics for Azure. The company urges the European Commission to act promptly to end Microsoft's "vendor lock" and level the playing field for competitors.

The cloud computing market is growing at around 20% per year in the EU, with plenty of potential. A McKinsey study in April 2024 showed that two-thirds of EU companies had less than half of their workloads on the cloud, indicating significant room for growth.

Google's complaint comes amidst a broader debate on competition in the tech industry. As Microsoft, Amazon, and Alphabet continue to invest heavily in AI and cloud technologies, regulatory scrutiny is intensifying. The European Commission will now evaluate Google's claims and determine the appropriate course of action.

In conclusion, Google's complaint against Microsoft highlights the growing competition and regulatory scrutiny in the cloud computing market. As the market continues to expand, it is crucial for companies to adhere to fair competition practices to ensure a level playing field for all participants.