EU Antitrust Dispute Concluded with Agreed Settlement between Microsoft and EU

by Jabez
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Microsoft Reaches Settlement with Cloud Providers, Concludes EU Antitrust Dispute
Microsoft has reached a settlement with cloud providers, resolving a two-year dispute over its licensing practices. This agreement, negotiated with the cloud association CISPE, which is supported by Amazon, aims to persuade EU regulators to withdraw an antitrust complaint against Microsoft.
Francisco Mingorance, Secretary General of CISPE, expressed optimism about the settlement, stating that it is expected to create a fair competitive environment for European cloud infrastructure service providers and their customers. As part of the agreement, CISPE will retract its November 2022 complaint to the European Commission and agree not to file or support similar complaints in the EU or elsewhere.
In exchange, Microsoft has agreed to alter certain software licensing practices within nine months. The company will also make a lump sum payment to CISPE to cover its litigation and campaign expenses. Notably, Amazon will not benefit from or be bound by these terms, according to CISPE.
An Amazon Web Services spokesperson criticized the settlement, claiming it offers only limited concessions. They argued that the settlement fails to address the needs of most Microsoft customers who wish to use their preferred cloud services in Europe and globally. Amazon continues to support calls for Microsoft to end discriminatory practices for all customers.
Microsoft President Brad Smith welcomed the resolution, stating, “I’m pleased that we’ve not only resolved their concerns of the past, but also worked together to define a path forward that brings even more competition to the cloud computing market in Europe and beyond.”
This settlement follows similar agreements Microsoft has reached with other cloud companies, such as OVHcloud, Aruba, and the Danish cloud association, to resolve separate antitrust complaints.
Ongoing Regulatory Challenges
The resolution comes amid increasing regulatory scrutiny of Microsoft across Europe. The company has faced mounting pressure from regulators, including a UK investigation into cloud services.
Recently, the European Commission accused Microsoft of violating EU antitrust rules by bundling its Teams communications app with its popular Office suite. This charge followed a probe launched last year, triggered by a 2020 complaint from Slack.
In response, Microsoft has made efforts to unbundle Teams in Europe and globally. The company also introduced improvements in September 2023 to enhance interoperability with competitors. However, the Commission stated that these changes were insufficient to fully address its concerns.
EU Competition Commissioner Margrethe Vestager emphasized that “Microsoft now has the opportunity to reply to our concerns.” Brad Smith indicated Microsoft’s willingness to take further steps, stating, “Having unbundled Teams and taken initial interoperability steps, we appreciate the additional clarity provided today and will work to find solutions to address the Commission’s remaining concerns.”
Broader Implications and Future Outlook
The ongoing regulatory pressure extends beyond the cloud services dispute. EU regulators are also examining Microsoft’s partnership with OpenAI, the company behind ChatGPT, to determine if it constitutes a disguised merger.
As Microsoft navigates these regulatory challenges, the company has expressed a commitment to working with authorities to find solutions that address competition concerns while continuing to innovate in the rapidly evolving tech landscape.
The resolution of the cloud services dispute marks a significant step for Microsoft in addressing antitrust concerns in Europe. However, the company still faces scrutiny on multiple fronts, highlighting the complex regulatory environment for tech giants in the EU and globally.

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