On Wednesday, Google filed a complaint with the European Commission accusing Microsoft of illegally leveraging its dominant position in the Windows market to coerce businesses into using Microsoft Azure cloud services. Google alleges that companies are being forced to adopt Azure, charged up to 400 percent more to use competing clouds, or denied upgrades and security updates if they choose other providers.
According to Google’s complaint, Microsoft penalizes customers only when they attempt to use products from three competitors: Google Cloud, AWS and Alibaba Cloud. Google calls Microsoft’s practices “an artificial and arbitrary economic penalty for not using Azure.” The complaint adds that if these penalties were genuinely designed to monetize Microsoft’s intellectual property, they would apply to all non-Azure cloud providers, not just Azure’s principal rivals.
Google expands on its arguments in a company blog post where it explains the specifics of the complaint.
“For years Microsoft locked customers into Teams even when they preferred other vendors, particularly in productivity software. Now it is applying the same tactics to channel customers toward Azure,” write Amit Zavery, GM/VP of Google Cloud, and Tara Brady, President of Google Cloud EMEA. “Microsoft’s licensing terms prevent European customers from moving their existing Microsoft workloads to competing clouds — despite there being no technical barriers — or impose a dramatic 400 percent price increase.”
Google claims Microsoft is the only cloud provider using these tactics and that the practice has caused significant harm to European businesses and governments. Google estimates the conduct has cost European companies at least €1 billion per year and led to wider negative consequences such as wasted public funds, reduced competition, restrictions for distributors and channel partners, and increased organizational risk tied to what Google calls Microsoft’s “insufficient” security culture.
Google notes Microsoft did not always act this way. “Until 2019, customers could migrate to any cloud provider’s dedicated infrastructure. That created a problem for Microsoft: how to ensure customers chose Azure instead of a competitor,” the complaint states. “Microsoft’s response was to exploit customer dependence on products like Windows Server by imposing large penalty fees for using on-premises software with Azure rivals.”
Google also criticizes Microsoft’s marketing, saying Microsoft has promoted claims that competing offers are “up to five times more expensive than Azure for Windows Server and SQL Server.” Google argues those claims are misleading because Microsoft itself created the price differences by applying the penalties.
Microsoft provided a response via email but declined to address the specific allegations in detail, saying it expects the European Commission will not be persuaded. Microsoft stated that it has constructively resolved similar issues previously raised by European cloud providers, even after legal challenges brought by Google, and suggested Google will similarly fail to convince the Commission.
Industry analysts have differing takes. Dave McCarthy, research director for cloud and edge services at IDC, frames Google’s complaint as part of a broader shift in the cloud market. “Customers are re-evaluating how they build cloud-native applications and who they partner with,” he says, noting a slowdown in AWS and Azure growth while Google Cloud has accelerated. McCarthy adds that while Microsoft’s commercial terms may keep some customers on Azure in the short term, the long-term effect may push customers to remove Microsoft-dependent technologies from their stacks to maintain greater choice.
Tracy Woo, principal analyst for cloud services at Forrester, offers a more critical view of Google’s complaint. She characterizes Google’s filing as largely self-interested and says Google is upset that Microsoft is not cooperating with it—despite Microsoft working more closely with AWS. “Google has a reputation for being difficult to work with,” Woo notes, adding that Google is often less transparent about roadmaps and data than other vendors.
The dispute highlights growing tensions among major cloud providers as customers reassess cloud strategies and vendors seek competitive advantage through licensing and commercial terms. Regulators in Europe will now evaluate Google’s claims and determine whether Microsoft’s licensing practices cross the line into anticompetitive behavior that harms customers and the market.
This article summarizes Google’s complaint and the initial responses from Microsoft and industry analysts without adding new factual claims beyond those reported by the parties involved.