Alphabet Inc. (NASDAQ:GOOGL) shares inches up in pre trading session on Thursday as the Google attacked Microsoft’s (NASDAQ:MSFT) burgeoning cloud services business, calling it “anti-competitive” and pleading with EU authorities to take action against its rival’s business dealings with smaller firms.
In an interview with the news agency, Google Cloud VP Amit Zavery stated that “Microsoft obviously has a very anti-competitive approach in cloud.” They are making it difficult for customers to make a choice by tying Azure and the other cloud services to Office 365 and Windows, as well as their position of dominance in the on-premise market.
In response to worries that it was leveraging its dominance in the larger software industry to drive out competitors, Microsoft modified the conditions of its offering to European cloud hosting providers last October.
The European Commission received complaints about Microsoft’s business practices and licensing agreements from the French cloud services provider OVH Groupe (EPA:OVH), Germany’s Nextcloud, Italian rival Aruba, and a Danish association of cloud service providers, alleging discriminatory pricing and other unfair license terms.
It’s unclear, though, if the Redmond-based company’s adjustments would be sufficient to halt a fresh inquiry against it by EU antitrust investigators.
In the upcoming days or weeks, the EU, which has historically been more aggressive than U.S. authorities in fining Big Tech for anti-competitive activities, will decide whether or not to launch an inquiry.
With Amazon Web Services (NASDAQ:AMZN) losing ground to Microsoft over the past few years, Microsoft is now the leading cloud provider with the quickest rate of growth. According to data produced by Synergy Research Group, Amazon’s market share has recently been about 30%, while Microsoft’s Azure claims a global market share of about 23%. According to Synergy, Google Cloud’s market share is around 11%.
Due to societal trends toward digitalization and, particularly, the proliferation of Artificial Intelligence applications, the market for cloud hosting services, which is already worth over $200 billion annually, is anticipated to expand rapidly in the years to come.
