Google has formally withdrawn its EU antitrust complaint accusing Microsoft of using licensing and pricing practices to advantage Azure and lock customers into Microsoft’s cloud, a tactical retreat announced the same week the European Commission opened formal market investigations into the cloud sector under the Digital Markets Act (DMA).
The last 18 months have turned the European policy debate over cloud computing from industry-level squabbles into a regulatory front line. The Commission’s decision to launch three DMA market investigations — two company-specific reviews focused on Microsoft Azure and Amazon Web Services (AWS), and a horizontal study testing whether the DMA’s toolkit can be applied to cloud infrastructure — is the immediate context for Google’s withdrawal. These probes were officially announced by the European Commission on 18 November 2025. Google originally filed its complaint about Microsoft’s cloud licensing practices in September 2024, asserting that certain license terms and commercial mechanics disproportionately disadvantage rival cloud providers and raise the practical cost of migrating Microsoft-centric workloads away from Azure. The complaint included assertions about differential licensing, egress costs, proprietary APIs and alleged self-preferencing of native Azure services — themes regulators are now pursuing themselves through the DMA market investigations. This shift matters because the DMA provides regulators with ex‑ante powers and specific obligations that differ from traditional, ex‑post antitrust enforcement. Under the DMA, a gatekeeper designation can trigger requirements such as non‑discrimination, mandated interoperability, enhanced portability and steep sanctions for non‑compliance — remedies that can be faster, broader and more prescriptive than case-by-case antitrust orders. Google’s decision to withdraw its complaint is therefore best read as a strategic move to channel pressure into Brussels’ DMA process, where systemic remedies may be more readily imposed.
Regulators now hold the agenda-setting power. The months ahead will test Brussels’ capacity to translate platform‑centric DMA concepts into workable, technically precise rules for enterprise cloud infrastructure. For enterprises, the practical implications are immediate: recheck licensing exposure, build portability into procurement, and plan for a period of regulatory uncertainty that could produce meaningful protections or significant operational change.
This is a defining moment for cloud competition policy — where the architecture of regulation may matter as much as the architecture of the cloud itself.
Source: Reuters https://www.reuters.com/world/googl...out-microsoft-cloud-amid-eu-probe-2025-11-28/
Source: Investing.com Google ditches EU antitrust complaint about Microsoft cloud amid EU probe By Reuters
Background / Overview
The last 18 months have turned the European policy debate over cloud computing from industry-level squabbles into a regulatory front line. The Commission’s decision to launch three DMA market investigations — two company-specific reviews focused on Microsoft Azure and Amazon Web Services (AWS), and a horizontal study testing whether the DMA’s toolkit can be applied to cloud infrastructure — is the immediate context for Google’s withdrawal. These probes were officially announced by the European Commission on 18 November 2025. Google originally filed its complaint about Microsoft’s cloud licensing practices in September 2024, asserting that certain license terms and commercial mechanics disproportionately disadvantage rival cloud providers and raise the practical cost of migrating Microsoft-centric workloads away from Azure. The complaint included assertions about differential licensing, egress costs, proprietary APIs and alleged self-preferencing of native Azure services — themes regulators are now pursuing themselves through the DMA market investigations. This shift matters because the DMA provides regulators with ex‑ante powers and specific obligations that differ from traditional, ex‑post antitrust enforcement. Under the DMA, a gatekeeper designation can trigger requirements such as non‑discrimination, mandated interoperability, enhanced portability and steep sanctions for non‑compliance — remedies that can be faster, broader and more prescriptive than case-by-case antitrust orders. Google’s decision to withdraw its complaint is therefore best read as a strategic move to channel pressure into Brussels’ DMA process, where systemic remedies may be more readily imposed. What Google withdrew — and why it matters
The complaint’s substance, in short
Google’s original complaint targeted a cluster of practices that, it argued, created practical "vendor lock‑in" for Microsoft workloads:- Differential licensing: Allegations that running Windows Server, SQL Server and other Microsoft stack components on non‑Azure clouds is made materially more expensive by licensing surcharges or restrictive terms.
- Migration friction / egress costs: Claims that contractual or technical barriers — including high exit fees and slow, fragile export tooling — increase the time and money needed to move production workloads.
- Proprietary APIs and self‑preferencing: Concerns that control‑plane APIs and managed services are architected or packaged in ways that favor Azure-native managed offerings over independent vendors or rival cloud platforms.
- Marketplace and bundling practices: Assertions that Microsoft’s packaging, integration with its productivity stack, and marketplace placement can tilt performance, pricing or visibility to benefit Azure.
Google’s public framing
Google framed the withdrawal explicitly as a pragmatic decision tied to the Commission’s new DMA process. A Google Cloud statement says the complaint is being withdrawn “in light of the recent announcement that the EC will assess problematic practices affecting the cloud sector under a separate process,” while reaffirming continued advocacy for choice and openness in the cloud market. That blog‑post update reaffirms Google’s original arguments but redirects enforcement energy toward Brussels’ market investigations.The European Commission’s DMA cloud probes — scope and mechanics
What the Commission is investigating
Brussels opened three linked inquiries under the DMA:- A market investigation into whether Microsoft Azure functions as a DMA “gatekeeper” for cloud computing services.
- A similar market investigation into Amazon Web Services (AWS).
- A horizontal, sector‑wide study to assess whether the DMA’s obligations — conceived for consumer-facing platforms — can be adapted to the enterprise, contract-driven cloud domain.
Timeline and powers
The Commission signalled an accelerated fact‑finding clock: company-level gatekeeper assessments are expected to aim for roughly a 12‑month horizon, with a broader market review report possible within 18 months. The DMA grants Brussels investigatory powers to request contracts, telemetry, invoices and on‑site evidence — tools that make the Commission a far more potent forum for testing the contested numerical claims that have circulated in press accounts.Verifiable facts and contested claims
Solidly verifiable
- Google has withdrawn its EU antitrust complaint targeting Microsoft’s cloud practices.
- The European Commission launched DMA market investigations into AWS and Azure and opened a horizontal study on 18 November 2025.
- The DMA carries ex‑ante obligations and sanctions that are materially different from legacy antitrust measures.
Claims that remain contested or unverifiable in public records
A number of attention‑grabbing figures and characterisations in the public debate remain unproven in open sources and will require regulator access to confidential contracts and billing data to validate. Examples include:- Media references to “up to 400%” markups or €1 billion annual software taxes tied to Microsoft licensing on rival clouds. These numbers are cited in certain company statements and trade‑group studies but are contested and heavily dependent on contract specifics and methodology. Regulators — not press summaries or corporate press releases — will need to test these claims against invoices and contractual evidence.
Strategic reading: what Google gains, and what it risks
Gains from withdrawing the complaint
- Leverage through regulation: The DMA process can deliver systemic remedies (portability, interoperability, non‑discrimination) that go beyond the narrow relief awarded in a single antitrust case.
- Faster, higher‑impact outcomes: DMA procedures are designed to move faster and to impose ex‑ante obligations — a potentially more decisive outcome for market structure than protracted litigation.
- Lower litigation optics: Withdrawing reduces the risk of a protracted bilateral public fight with Microsoft that could produce reputational or commercial blowback while preserving Google’s ability to feed evidence into Brussels’ process.
Risks and trade‑offs
- Ceding the narrative to Brussels: By stepping aside, Google accepts that Commission priorities, tactics, and negotiation posture will largely determine remedies and timing.
- Regulatory uncertainty: DMA policymaking is technical and political; the final shape of remedies could be less aggressive than Google hopes — or conversely, more disruptive to cloud operations than even competitors anticipate.
- Operational and commercial costs: If the Commission crafts poorly specified technical obligations (for example, a lowest‑common‑denominator API), this could introduce fragility or heavy compliance costs that ultimately flow to customers.
Likely scenarios and enterprise impact
Scenario 1 — Gatekeeper designation for activities (transformative)
If Brussels concludes AWS and/or Azure qualify as gatekeepers for certain cloud activities, expect tailored DMA obligations: mandatory non‑discrimination, API access, portability guarantees and new transparency requirements. This outcome would be transformative, forcing architectural and commercial changes across major cloud platforms. Enterprises would gain stronger contractual guardrails and portability assurances, but providers could pass through compliance costs.Scenario 2 — Binding commitments via settlement (probable compromise)
Microsoft or AWS could offer binding commitments — improved licensing transparency, migration tooling, and behavioral promises — without full gatekeeper designation. This is a common regulatory compromise that reduces legal risk while delivering concrete, if narrower, protections. It is plausible given past private settlements (for example, earlier CISPE negotiations).Scenario 3 — Limited action or DMA deemed a poor fit (possible)
The Commission might decide the DMA’s framework requires major adaptation for cloud markets and instead recommend sectoral instruments or leave deeper enforcement to traditional competition law. This would preserve the status quo in the short term and maintain longer timelines for structural change.Practical short‑term advice for IT teams and procurement
- Audit licensing exposure and exit costs now: capture line‑item billing, licensing clauses, and egress provisions so negotiators can quantify migration risk.
- Demand contract transparency: require audit rights, exportable logs and defined service levels for portability and data extraction.
- Pilot portability and multi‑cloud patterns on non‑critical workloads to validate tooling and runbooks.
- Build financial flexibility: negotiate caps on egress, reserved pricing protections, and FinOps measures to reduce surprise costs.
Microsoft’s and AWS’s likely responses
Both Microsoft and AWS have incentives to cooperate with the Commission while defending their engineering and commercial models. Expect robust technical briefings, customer testimony, and legal argument that heavy‑handed DMA obligations risk disrupting service delivery and raising costs. Microsoft, in particular, will highlight prior settlements with European cloud providers and point to contractual remedies already implemented in response to earlier complaints. Those settlements and technical counterarguments will factor heavily into Brussels’ assessment.Wider policy implications: AI, sovereignty and global spillover
The DMA cloud probes are not just about software licensing; they arrive at a moment when cloud concentration intersects deeply with AI economics. Access to large pools of accelerator hardware, integrated AI stacks, and managed services can determine who builds, trains and deploys large models at scale. Regulators worry that provider concentration can entrench incumbents and skew innovation incentives. Any EU action that curtails provider practices could ripple globally, influencing procurement norms, technical standards, and even national digital sovereignty strategies.Technical realism: the regulator’s hardest problem
Translating platform‑style DMA obligations into operational requirements for distributed compute, networking and enterprise software is a non‑trivial engineering exercise. Mandating “interoperability” without precise interface and performance specs risks producing either toothless obligations or brittle, lowest‑common‑denominator interfaces that harm users. Brussels will therefore need deep technical inputs and carefully scoped remedies that preserve innovation while improving contestability. This is precisely the tension regulators face: meaningful safeguards for buyers without undermining the performance, security and investment incentives that sustain hyperscale cloud platforms.What to watch next — milestones and signals
- Evidence submissions and technical briefings: expect public and confidential filings from Microsoft, AWS, Google, large enterprise customers and European cloud providers over the coming weeks. These filings will shape the Commission’s evidence record.
- Interim market signals: procurement behaviour by large EU public buyers and private enterprises may shift as legal clarity changes — procurement notices and RFIs will be telling.
- Commission interim findings: any early determinations about the DMA’s fitness for cloud will be crucial. The Commission aims for company‑level assessments within about 12 months, so substantive updates could arrive within that timeframe.
Conclusion
Google’s decision to withdraw its EU antitrust complaint against Microsoft is a tactical, programmatic shift rather than a retreat from the substance of its allegations. By stepping back and letting Brussels’ DMA machinery take the lead, Google refocuses the dispute onto a regulatory pathway capable of delivering systemic, ex‑ante remedies — remedies that, if adopted, would reshape licensing, portability and interoperability across cloud platforms.Regulators now hold the agenda-setting power. The months ahead will test Brussels’ capacity to translate platform‑centric DMA concepts into workable, technically precise rules for enterprise cloud infrastructure. For enterprises, the practical implications are immediate: recheck licensing exposure, build portability into procurement, and plan for a period of regulatory uncertainty that could produce meaningful protections or significant operational change.
This is a defining moment for cloud competition policy — where the architecture of regulation may matter as much as the architecture of the cloud itself.
Source: Reuters https://www.reuters.com/world/googl...out-microsoft-cloud-amid-eu-probe-2025-11-28/
Source: Investing.com Google ditches EU antitrust complaint about Microsoft cloud amid EU probe By Reuters
