Spanish Startup Association Alleges Microsoft’s Anti-Competitive Practices

The Spanish Startup Association, representing over 700 startups in Spain, has raised concerns over what it alleges to be anti-competitive behavior by Microsoft in recent years.
Cloud market share of AWS, Microsoft, Google 2023While the U.S. tech giant currently holds the second position in the cloud computing sector, trailing market leader Amazon, it is anticipated to swiftly narrow the gap due to the appeal of generative AI features powered by OpenAI’s technology for business users.

According to a complaint obtained by Reuters, the association accuses Microsoft of leveraging its dominant position in operating systems (Windows) and traditional productivity software (Microsoft Office, Windows Server, SQL Server) to promote its Azure cloud. Additionally, the complaint claims that Microsoft has imposed artificial barriers hindering startups from competing fairly and effectively.

The alleged practices include barriers to data portability and contractual conditions that limit competition in software licenses, thereby restricting the freedom of choice for service providers. These restrictions, as outlined in the document, undermine startups’ ability to innovate, grow, and maintain resilience in the market.

Calling for action, the association has urged the Spanish competition watchdog to launch an investigation and implement urgent measures to ensure a competitive market environment. Carlos Mateo, President of the Spanish Startup Association, emphasized the importance of fostering an equal playing field for all companies, both as customers and providers of technology.

This complaint echoes previous concerns raised by Cloud Infrastructure Services Providers in Europe (CISPE), a group that includes Amazon, who in November lodged a complaint with EU antitrust regulators regarding Microsoft’s new contract terms introduced on October 1. CISPE alleged that these terms, along with other practices, were detrimental to the European cloud computing ecosystem.

In response to these allegations, the European Commission has initiated inquiries, seeking input from cloud rivals regarding Microsoft’s request for customer data. Concurrently, the UK Competition and Markets Authority is conducting its own investigation into the sector, indicating a broader regulatory scrutiny over the cloud computing industry.

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