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Today's Topics:
1. Microsoft: So what if costs 4X as much to run Windows Server
(Stephen Loosley)
----------------------------------------------------------------------
Message: 1
Date: Tue, 04 Mar 2025 22:39:09 +1030
From: Stephen Loosley <[email protected]>
To: "link" <[email protected]>
Subject: [LINK] Microsoft: So what if costs 4X as much to run Windows
Server
Message-ID: <[email protected]>
Content-Type: text/plain; charset="UTF-8"
Microsoft: So what if costs 4X as much to run Windows Server in AWS, Alibaba,
and Google?
That's competition, that's protecting our IP, Redmond's lawyers tell UK
competition regulator
By Dan Robinson Tue 4 Mar 2025
https://www.theregister.com/2025/03/04/microsoft_blasts_uk_market_regulator/
For AWS and Google to urge the UK competition regulator to "intervene and
constrain the price" that Microsoft charges them to license its software in
their clouds is both "extraordinary and unprecedented."
Or so says Microsoft in a response to the Competition and Markets Authority
(CMA), Britain's anti-trust police which issued a provisional ruling in January
on the parlous state of the health of the UK cloud computing sector:
competition could be better, it said, and Microsoft's tactic didn't help.
https://www.theregister.com/2025/01/28/microsoft_and_aws_cma_provisional_findings/
AWS are classified by Microsoft as listed providers, as such clients wanting to
run - for example - Windows Server, have to pay up to four times more to do so
in those non-Azure clouds. Both vendors complained this puts them and their
customers at a disadvantage.
The CMA agreed "Microsoft has the ability and incentive to partially foreclose
AWS and Google using the relevant Microsoft software products and that its
conduct is harming competition in cloud services."
Now Microsoft has thrown off the gloves and come out slugging in response [PDF]:
https://assets.publishing.service.gov.uk/media/67c1894168a61757838d20ed/Microsoft_response_to_provisional_decision.pdf
"In short, Amazon and Google are asking the CMA to intervene and constrain the
price Microsoft can charge them when they use Microsoft's software to build and
sell cloud services to their customers and the price Microsoft charges its
clients on Azure for the use of Microsoft software.
"This is an extraordinary and unprecedented intervention, riding roughshod over
Microsoft's intellectual property rights. No other software provider in the
industry would be subject to similar limitations," says Microsoft.
The "only beneficiaries of this remedy" are Amazon and Google, adds the
submission by Microsoft. No doubt some customers that don't want to run
Microsoft wares in Azure - for whatever reason - may take exception.
Google previously described to The Register what it sees as a "software tax"
that Microsoft has charged Google and AWS customers since 2019. Google filed
its first ever anti-trust complaint against Microsoft with the European
Commission in September.
Previous research in Europe by Fr?d?ric Jenny, emeritus professor of Economics
at ESSEC Paris Business, commissioned by AWS backed trade group CISPE, found
customers in Europe were being collectively overcharged ten-digit sums due to
Microsoft's Bring Your Own Licence policy.
Microsoft says that "owing" to its legacy software operation it has customers
ready to move workloads from private datacenters to the cloud. It prefers them
to choose Azure, even though "our software is also available on other public
clouds, including AWS and Google Cloud.
"We compete to win their business in a variety of ways, including competitive
pricing. One way we let them know that we intend to offer attractive prices in
our marketing efforts is to provide a standing offer to discount Azure and
offset the portion of the price attributable to Windows Server and SQL Server
software when customers deploy workloads on Azure that rely in part on that
software. This is not foreclosure; this is the essence of competition, and it
benefits UK customers."
It asks the CMA to compare this strategy to AWS's S3, Aurora, DynamoDB, and
Google's BigQuery, Looker, Google Analytics and more.
"Do AWS and Google license their proprietary software to their competitors, at
any price at all? They do not." The submission adds: "You can see how we might
feel unfairly singled out."
The protests from its major rivals ring hollow, says Microsoft, because AWS is
the largest cloud computing vendor in the UK - where it accounted for up to 50
percent of the ?9 billion ($11.4 billion) customers spent in 2023. Microsoft
accounted for between 30 to 40 percent. Google Cloud is a distant third, yet it
has grown to a $36 billion run-rate operation globally as of calendar Q4.
Microsoft also says Google has "sunk thousands, if not millions, of dollars to
stand up and support 'trade associations,' who unsurprisingly parrot its claims
to competition authorities and government officials."
It is correct that Google tried to join CISPE, offering a pretty penny in the
process, yet Microsoft seemingly had more success in courting that trade
assocation. Google has since joined the Open Cloud Coalition (OCC), and
Microsoft has already branded this as a lobby group, astro-turfing officials.
Other news:
Cloud market working well ... if you're AWS and Microsoft
Brit competition watchdog takes aim at Google, Apple's mobile ecosystems
AWS claims customers are packing bags and heading back on-prem
Google files first ever complaint with European Commission against Microsoft
Egress fees, high level of market concentration, and significant barriers to
entry are other concerns expressed by the CMA on the overall cloud market in
Britain. AWS has also come in for heavy criticism, though Google received a
get-out-of-jail card as it was found in the UK to have a "much smaller market
share." (Shhh, don't tell investors, keep this between Google and the CMA.)
The CMA is now deliberating whether to use its digital markets powers to make
interventions relating to the barriers it has identified, namely egress fees,
technical barriers, and Microsoft's licensing practices. A final decision is
expected later this year.
The Register intends to pore over other submissions from cloud vendors to the
CMA this week.
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