We recently reported on the near-monopoly in the cloud companies like Microsoft, AWS and Google are forming. Now, Google Cloud VP, Amit Zavery has come out to criticise Microsoft Azure’s restrictive policies.
He told the Register that Microsoft penalises customers with extra licensing costs for running their cloud services on other cloud platforms but noted that antitrust regulators are beginning to pay attention. He said, “It shows you how much pull they have, that is the cost to customers, because they don’t have a choice”
So, what’s the problem?
In 2019, Microsoft bought in a policy that effectively taxes customers using their software on other cloud providers. The company created a list of providers that this would affect; Google, AWS and Alibaba. They then allowed customers to exchange their licences for SaaS-based Azure licences. If customers didn’t want to use Azure they’d have to rebuy their licences. Pretty sneaky!
This move by Microsoft is a prime example of vendor lock-in, when the route to leave a cloud provider is made deliberately difficult and/or expensive so that customers are essentially forced to stay. Providers can offer an inferior service without losing customers. This removes competition from the market, meaning better companies lose out and customers have to put up with over-paying for a service that could be a lot better.
Legal Trouble for Microsoft
AWS, as a member of the Cloud Infrastructure Service Provider of Europe (CISPE) trade association, took the issue to the EU. The group filed a complaint and rejected Microsoft’s attempt to block it. Over the last decade, Microsoft has been fined $1.6bn for antitrust violations by the European Commission. Just this March, they settled a case brought against them by OVHcloud, Aruba S.p.a., and the Danish Cloud Community.
Amit Zavery, VP of Google Cloud has bought further attention to Microsoft’s anticompetitive practices. This adds yet another voice to the litany of criticism directed at the company, from the EU and others. Vendor lock-in is a huge problem within cloud computing, along with a tendency to monopolise. Do you think this is getting enough attention, or perhaps too much? Let us know in the comments!