Technology trade groups, including Google (owned by Alphabet), have expressed their concerns to the Federal Trade Commission regarding alleged unfair business practices in the cloud industry, particularly by Microsoft, the market’s second-largest player, The Information reported.
They submitted these comments in response to a request from the U.S. agency in March for information on security issues and competition in the lucrative data storage and cloud market.
These grievances come in the wake of global scrutiny, including an investigation by Europe’s antitrust authority into Microsoft’s licensing agreements, which supposedly discourage the use of rival cloud services. Additionally, the industry has faced criticism for the fees associated with data retrieval from different cloud providers.
NetChoice, a trade group whose members include major players like Amazon.com, Meta Platforms, Google, and other smaller tech companies, targeted Microsoft and Oracle in its public comments.
NetChoice stated that despite significant competition in the cloud industry, a few vendors employ anti-competitive practices to solidify their market position. They do so by preventing customers from switching providers to seek lower costs, stronger service offerings, and more innovative solutions for their businesses.
Google supported this sentiment in its own submission, asserting that licensing terms enforced by Microsoft, Oracle, and other legacy on-premises software providers distort competition in the cloud. Google also mentioned the restrictions and additional charges faced by businesses that purchased Microsoft software for their own data centers when migrating those licenses to Microsoft’s top cloud competitors. Amazon has expressed similar concerns.
Microsoft has made some updates to its terms in response to the criticism, claiming a commitment to the success of the broader cloud community. However, its rivals have deemed these changes inadequate.
Leading Cloud service providers are Amazon Web Services (AWS) with 32 percent share, Microsoft Azure with 23 percent and Google Cloud with 9 percent share during the first quarter of 2023, according to Canalys report.
