Microsoft Evades EU Antitrust Investigation through Cloud Lobby Deal

Microsoft Sidesteps EU Antitrust Probe with CISPE Settlement

Microsoft Corporation has successfully avoided an extensive European Union antitrust investigation into its cloud business by reaching an agreement with a trade lobby backed by Amazon.com Inc. The Cloud Infrastructure Services Providers in Europe (CISPE) agreed to withdraw its complaint against Microsoft following the settlement.

CISPE had previously argued that Microsoft’s practice of tying its business software to its Azure cloud services created challenges for customers wanting to switch cloud providers. This agreement marks the culmination of over a year of negotiations between Microsoft and CISPE, resulting in a roadmap that fosters greater competition within the European cloud computing market.

Enhanced Features for CISPE Members

Under the terms of the deal, CISPE members will gain access to enhanced features on Microsoft Azure. This includes the ability for service providers to offer Microsoft applications and services on their own local cloud infrastructures. The European Commission will now evaluate the settlement’s impact on cloud market competition within the region.

No Benefits for Major Competitors

Notably, the agreement excludes CISPE’s largest member, Amazon Web Services (AWS), along with other major competitors like Google Cloud Platform and Alibaba Cloud. AWS criticized the deal, stating it fails to address the needs of the majority of Microsoft customers who still cannot freely choose their preferred cloud providers in Europe and globally.

Despite the settlement, dissent remains among some major market players. Google, through its head of platform Amit Zavery, expressed intentions to continue challenging Microsoft's licensing practices to support choice, innovation, and digital economic growth in Europe.

Historical Antitrust Scrutiny

Microsoft’s history with EU antitrust scrutiny dates back several decades, including prolonged legal battles over its Windows operating system. More recently, the company’s $13 billion investment into OpenAI Inc. has come under informal investigation over concerns about the exclusive use of Microsoft's cloud technology by the AI firm. Additionally, in June, the EU accused Microsoft of abusing its power by bundling its Teams app with other business software.

This CISPE settlement marks another chapter in Microsoft's ongoing regulatory challenges in Europe, with the company making significant concessions to appease various stakeholders and stave off further antitrust probes.