Tech companies including Google complain of unfair cloud practices

(Reuters) – Technology industry groups including Alphabet Inc.’s Google have filed complaints with the Federal Trade Commission about alleged unfair business practices in the cloud, including by Microsoft Corp., the industry’s second-largest by market share.

The comments, expected Wednesday, respond to a request for information from the U.S. agency in March on security and competition issues in the lucrative market for data storage and computing power in what is known as the cloud.

They also follow investigations around the world, including a recent probe by the European antitrust authority into Microsoft’s licensing agreements that allegedly discourage use of rival clouds. Fees for scraping data from various providers’ clouds have also drawn criticism from the industry.

In one example from Tuesday’s public comments, trade group NetChoice took aim at Microsoft and Oracle.

“Despite vibrant competition in the cloud industry, some providers are using anticompetitive practices to entrench their position, most often by preventing customers from switching providers in search of lower costs, stronger service offerings and more innovative solutions for their businesses,” said NetChoice, whose members include market leader Amazon.com, Meta Platforms, Google and other smaller technology players.

Google echoed this sentiment in its own filing, saying that “licensing terms applied by Microsoft, Oracle and other traditional on-premises software vendors distort competition in the cloud.”

For example, companies that have purchased Microsoft software for their own data centers face restrictions and additional fees when migrating those licenses to Microsoft’s major cloud competitors, Google said, consistent with its previous comments. Amazon has made similar criticisms.

Microsoft and Oracle did not immediately respond to Reuters requests for comment. Microsoft has updated some language in response to criticism, saying, for example, that it is committed to broader success in the cloud community, but competitors have called those changes insufficient.

The FTC declined to comment. Earlier reports said Google’s filing.

(Reporting by Urvi Dugar and Samrhitha Arunasalam in Bengaluru and Jeffrey Dastin in Palo Alto, California; additional reporting by Jaspreet Singh in Bengaluru; editing by Krishna Chandra Eluri and Christopher Cushing)