Over the past decade, Microsoft has pulled off a remarkable transformation of its public image in Europe — from bad boy to the most Brussels-friendly of tech giants? But that shine may now be coming off. In Brussels and across Europe, the Seattle-based giant faces a flurry of antitrust complaints about its cloud business as well as fresh claims that the company is not living up to its word on paying press publishers for their content. A new onslaught is picking away at Microsoft's image in Europe as the "friendly one" among Big Tech companies — a position that was painstakingly cultivated under the leadership of Microsoft's veteran lawyer-president, Brad Smith, during the past seven years. “Some companies have pretended for years to have cloaks of invisibility, but the spell has worn off. Abuse of market dominance is unfair and now that the abuse is slowly becoming visible, we as legislators will ensure that the cloaks no longer will work,” said Paul Tang, a left-wing Dutch member of the European Parliament. Microsoft has tactfully managed to avoid the heavy antitrust fines of yesteryear — the last significant one being a €561 million slap on the wrist in 2013 for failing to follow previous competition orders, closing a 10-year period in which it had racked up €2.24 billion in EU antitrust penalties. But practices are now emerging that hark back to the time when the company found itself in the EU's crosshairs, calling into question its straight-laced image. “Microsoft also engages in many of the same practices in the few areas where it has an entrenched position — in particular, how it uses Windows’ dominant position in PC operating systems to leverage into other markets,” said Zach Meyers, a senior research fellow at the Centre for European Reform. He was referring to the bundling of Microsoft's products and the promotion of its own services within its own systems — concerns that prompted office messenger service Slack to file a complaint to the European Commission in 2020, over concerns that the company had been illegally tying its Teams software, which competes with Slack's own, with its "market-dominant Office productivity suite." The Commission is still evaluating the complaint. Among pro-regulation pushes, Microsoft supported the EU’s recently adopted Digital Markets Act, pitching a series of "principles" for its own app store intended to curry favor with EU regulators working on the new rules. Smith himself contracted meetings with the bloc's digital czar Margrethe Vestager, in which he highlighted his company's commitment to the EU crackdown on Big Tech giants. But those stances are now being called into question amid a flurry of complaints, targeting one of Microsoft's largest and less-known businesses: cloud computing. In Q2 this year, the company’s commercial cloud revenues reached $22.1 billion. The European Commission has started to ask cloud computing companies about Microsoft’s practices in their market following complaints filed last year by the likes of French cloud outfit OVH Cloud and German player NextCloud. The former had accused Microsoft of abusive licensing terms while the latter was concerned about the bundling of the company’s OneDrive products and services with the Windows operating system. EU antitrust regulators circulated a questionnaire to Microsoft Azure partners and rival outfits in March, soliciting information on potentially abusive actions undertaken by the U.S. tech outfit regarding the licensing of its products. For its part, CISPE, a cloud services association representing some of the players involved in the Microsoft complaints, said that smaller firms that rely on Microsoft’s cloud have been afraid to speak out. “Fear of retaliation and dependency on its productivity software created a culture of omertà that prevented people from speaking out,” said Francisco Mingorance, secretary-general of CISPE. For more visit OUR FORUM.
