Microsoft responds to CMA cloud levy, says it won’t unnecessarily increase costs for customers
Microsoft, which recently came under scrutiny in Europe for its perceived unfair dominance of the cloud market, has responded to similar complaints from the UK’s Competition and Markets Authority (CMA).
The company insists the terms “do not materially increase the costs of cloud competitors”, adding that Amazon is still the market-leading hyperscaler in the UK and that the CMA should instead focus on Microsoft’s rival company.
Microsoft also noted Google’s strong quarterly growth and Windows Server’s decline compared to Linux in cloud operating system market share.
Microsoft tells the CMA to look everywhere but there
In his 100-point answer Microsoft concluded in the CMA investigation that no measures should be taken against the company. Should the CMA proceed, Microsoft requests that the exit costs not be abolished. Microsoft also believes that companies should be able to recover the costs associated with terminating a contract.
The CMA’s primary concern is how much Microsoft charges customers to use its software on competing clouds compared to its own Aure service. Most customers indicated that using Microsoft products on Azure was cheaper than using services from major competitors.
Amazon and Google believe that customers should be able to freely use their licenses across clouds, while Microsoft believes it is a good thing that it gives users access to its tools even if they don’t use the cloud.
Although Microsoft and competing cloud companies have responded to initial inquiries, it could take until late 2024 before a preliminary decision is made, at which point stakeholders will have another chance to weigh in.
The CMA will publish its final decision approximately 18 months after Ofcom’s first referral on 5 October 2023, in line with the statutory deadline of 4 April 2025.
