- Microsoft has accused Google of undermining its business with “shadow campaigns.”
- The company said that Google has formed a group to influence cloud regulation in Europe.
- Microsoft leads Google for cloud market share, while Amazon Web Services is on top.
Microsoft publicly accused Google of running “shadow campaigns” to undermine its business and influence cloud regulation in Europe in an escalation of the rivalry between the tech giants.
In a blog post shared on monday, Microsoft’s general counsel, Rima Alaily, accused Google of designing a group – called the Open Cloud Coalition – to tilt the regulatory landscape in favor of its own cloud services.
The new lobby group includes Google and several smaller cloud providers.
“This week an astroturf group organized by Google is launched,” Alaily wrote in the post. “It is designed to discredit Microsoft with competition authorities and policy makers and mislead the public. Google has gone to great lengths to obfuscate its involvement, funding and control, mainly by recruiting a handful of European cloud providers, to serve as the public face of the new organization.”
A Google spokesperson told Business Insider that the company had been “very public” about concerns with Microsoft’s cloud license.
“We and many others believe that Microsoft’s anticompetitive practices lock out customers and create negative downstream effects that impact cybersecurity, innovation and choice,” a Google Cloud spokesperson said.
Nicky Stewart, a Senior Advisor at the Open Cloud Coalition, told Business Insider that the group is “transparent” about its members.
“We are not against any company, we are a pro-market coalition that is focused on advocating for the principles that strengthen the market for cloud services in Europe, mainly openness and interoperability. Every company that share these values and care about a healthy and thriving market for the cloud should join us,” Stewart said in response to questions on Microsoft’s blog.
Cloud wars
Microsoft’s decision to publicly accuse Google is an unusual step that could signal the intensification of tensions between the two old rivals.
Last month, Google filed an antitrust complaint against Microsoft with the European Commission, claiming that the company used anti-competitive licensing practices to force companies to stick with its Azure cloud infrastructure.
Rival Big Tech companies compete in various markets, including cloud infrastructure, research, AI and productivity software.
But Microsoft has historically beaten Google for cloud sales.
In the second quarter of 2024, Google Cloud generated $10.35 billion in revenue, while Microsoft Azure, included as part of the company’s Intelligent Cloud group, reported $28.5 billion in revenue.
In 2023, Google Cloud generated $33.7 billion in sales, while Microsoft’s Intelligent Cloud group reported $96.8 billion in sales. Amazon Web Services, the e-commerce giant’s cloud business, is the leading supplier by market share.
Alaily also accused Google of trying to distract from the regulatory scrutiny the company faces after recent antitrust rulings.
In the United States, the The Justice Department plans to ask a judge to break up Google, months after a federal judge decided that the company violated antitrust law with its search engine.
The Big Tech company also faced antitrust scrutiny over its Android app store. In a recent decision in the blockbuster antitrust case of Epic Games, a judge ordered Google to open up Android to compete with third-party app stores. Google said it plans to appeal the decision.