Google has officially filed an antitrust complaint against Microsoft with the Federal Trade Commission (FTC), according to a report from The Information. The company claimed that Microsoft abused its dominant position in the enterprise software market to push more customers toward its cloud services.
In a letter to the FTC, Google explained that Microsoft used the licensing terms in its Office and Windows Server products to keep customers locked into its cloud computing business. The company argued that this approach prevents customers from switching to competitors’ products.
Google also said that Microsoft’s control presents a major national security risk. The company highlighted several security incidents where threat actors targeted Microsoft products, including SolarWinds attacks.
This is not the first time that Microsoft has been accused of anticompetitive practices. Last year, Microsoft agreed to change its cloud-computing practices to avoid an antitrust probe from the European Commission. The complaints were made by several European cloud vendors, including OVHcloud, Aruba, and CISPE. The licensing changes made it easier for customers to move their existing software to other cloud providers. However, it didn’t affect businesses based in the US.
The letter was sent in response to an FTC request for comment on the business practices of cloud computing companies. Specifically, FTC detailed that it’s seeking information about how it could impact competition, data security, as well as select industries like e-commerce and defense.
“Cloud providers once focused on customer retention via innovation and customer satisfaction,” said Corey Quinn, Chief Cloud Economist at The Duckbill Group. “Today, they have enough deterrent business practices in place to make switching providers an expensive Herculean undertaking.”
Microsoft’s CEO Satya Nadella revealed in the Q3 earnings call that its cloud services revenue grew by 13 percent. According to the latest Statista report, Amazon Web Services (AWS) is still the biggest player in the cloud computing market, followed by Microsoft Azure and Google Cloud. It will be interesting to see how the macroeconomic landscape affects revenues in 2023.