Nextcloud’s decision to withdraw its complaint to the European Commission alleging that Microsoft unfairly bundles OneDrive with Windows closes one chapter in a long-running European battle over platform bundling — but it does not end the fight over whether Big Tech can use dominant operating systems to steer users into their own cloud ecosystems. Nextcloud says lack of “noticeable progress,” mounting legal and administrative costs, and repeated, time‑consuming exchanges with the Commission prompted the move; the company will keep pursuing the matter in Germany, where the Bundeskartellamt has placed Microsoft under special supervision.
Nextcloud’s formal EU-level complaint was filed in 2021 on behalf of a coalition of around 30 European cloud and software providers. The core allegation: Microsoft leveraged its dominant Windows platform to promote and embed OneDrive, giving its own cloud service preferential access and distribution and effectively raising barriers for European competitors. Nextcloud and partners framed this as classic self-preferencing and gatekeeping — a map of conduct regulators have scrutinized before.
That EU complaint ran in parallel with national-level action. In Germany, the Bundeskartellamt opened proceedings that culminated in September 2024 with a determination that Microsoft is “an undertaking of paramount significance for competition across markets,” a classification that triggers enhanced abuse-control powers under Germany’s amended competition law. That decision put Microsoft under special supervision and created an enforcement path that is distinct from the EU’s competition toolbox.
Meanwhile, Europe’s competition spotlight extended to another Microsoft complaint: Slack (now owned by Salesforce) and other rivals alleged Teams was unfairly tied to Office. That case led to an EU market probe, a series of commitments from Microsoft, and — in September 2025 — the Commission’s acceptance of Microsoft’s remedial pledges to offer Office suites without Teams at reduced prices, strengthen interoperability, and support data portability. The Teams outcome is relevant because it shows the Commission can extract concrete commitments from Microsoft — albeit after a long process.
However, Nextcloud keeps its German case active, which matters for two reasons:
The Teams investigation — which culminated in binding commitments accepted in September 2025 — shows Brussels can secure concrete remedies, but the timeline (multi‑year) and the reliance on negotiated commitments rather than infringement findings underline a trade‑off: speed and certainty vs. adversarial remedies and fines. The Commission’s preference for commitments can be efficient, but it requires effective monitoring and robust enforcement to deliver market benefits.
Germany’s Bundeskartellamt retains enforcement tools and has signalled heightened scrutiny; the EU has demonstrated it can extract binding commitments (as in the Teams case) even if formal infringement findings are rare. On the ground, product changes to Windows 11 and Windows setup flows have already made avoiding Microsoft Accounts and cloud defaults more difficult, a fact that feeds the very competitive concerns Nextcloud raised.
For regulators, the episode raises uncomfortable but necessary questions about how to ensure smaller challengers can engage with EU enforcement mechanisms without being priced out of the process. For enterprises and public procurement officials, it reinforces the value of defensive planning now: auditing dependencies, testing portability tools, and negotiating contractual guardrails can convert regulatory uncertainty into operational resilience.
The fight over bundling and gatekeeping is far from resolved. Nextcloud’s EU withdrawal is tactical — a reallocation of scarce resources — not a renunciation of the underlying claim that dominant platforms can, by design or by slide, distort adjacent markets. The next decisive moves will more likely come from national enforcers’ decisions, the fidelity of Microsoft’s implementation of its commitments, and whether technical interoperability turns from promise into practice.
Source: theregister.com Nextcloud withdraws European Commission OneDrive complaint
Background: what Nextcloud complained about and how we got here
Nextcloud’s formal EU-level complaint was filed in 2021 on behalf of a coalition of around 30 European cloud and software providers. The core allegation: Microsoft leveraged its dominant Windows platform to promote and embed OneDrive, giving its own cloud service preferential access and distribution and effectively raising barriers for European competitors. Nextcloud and partners framed this as classic self-preferencing and gatekeeping — a map of conduct regulators have scrutinized before. That EU complaint ran in parallel with national-level action. In Germany, the Bundeskartellamt opened proceedings that culminated in September 2024 with a determination that Microsoft is “an undertaking of paramount significance for competition across markets,” a classification that triggers enhanced abuse-control powers under Germany’s amended competition law. That decision put Microsoft under special supervision and created an enforcement path that is distinct from the EU’s competition toolbox.
Meanwhile, Europe’s competition spotlight extended to another Microsoft complaint: Slack (now owned by Salesforce) and other rivals alleged Teams was unfairly tied to Office. That case led to an EU market probe, a series of commitments from Microsoft, and — in September 2025 — the Commission’s acceptance of Microsoft’s remedial pledges to offer Office suites without Teams at reduced prices, strengthen interoperability, and support data portability. The Teams outcome is relevant because it shows the Commission can extract concrete commitments from Microsoft — albeit after a long process.
What Nextcloud announced — the immediate facts
- Nextcloud publicly announced it has withdrawn its complaint to the European Commission’s Directorate‑General for Competition, citing “no noticeable progress,” the administrative burden of repeated replies, and costs associated with keeping the EU process open.
- The withdrawal is explicitly limited to the EC complaint; Nextcloud’s German filing with the Bundeskartellamt remains active. The German authority’s earlier step to designate Microsoft as an entity of “paramount significance” remains a live regulatory tool that could yield substantive remedies or prohibitions.
- Nextcloud reiterated its core claim that Microsoft uses its position “as gate keeper” to self‑prefer Microsoft services and to make it harder for rival clouds to interoperate with Windows and Office. The company singled out recent Windows setup changes that make avoidance of a Microsoft Account harder as an example of ecosystem entrenchment.
Why the withdrawal matters — practical and policy consequences
1. For Nextcloud and the European cloud ecosystem
Nextcloud’s exit from the EU docket reduces the immediate pressure on the Commission to open a formal infringement investigation over OneDrive bundling. That is a practical setback for a coalition of smaller European cloud providers that have relied on the Commission as the ultimate arbiter of cross‑border digital market abuses.However, Nextcloud keeps its German case active, which matters for two reasons:
- The Bundeskartellamt’s special supervision already grants it powers to prohibit anti‑competitive conduct and to require behavioural remedies in Germany; those tools can potentially be deployed more swiftly (and with national legal force) than a fresh EU infringement proceeding.
- National enforcement can create de facto precedents and practical constraints that influence Microsoft’s behaviour beyond Germany, especially because the underlying concerns are similar to those the EU has examined in the Teams inquiry.
2. For the Commission and European enforcement strategy
The withdrawal highlights procedural friction in the EU’s competition architecture. Firms and advocacy groups that lack deep legal resources often face an uphill battle in protracted Commission procedures. Nextcloud cited repeated exchanges with Commission case teams and administrative costs as a central reason for departure; that commentary is a candid critique of the resource burden the EU process can impose on small and medium challengers.The Teams investigation — which culminated in binding commitments accepted in September 2025 — shows Brussels can secure concrete remedies, but the timeline (multi‑year) and the reliance on negotiated commitments rather than infringement findings underline a trade‑off: speed and certainty vs. adversarial remedies and fines. The Commission’s preference for commitments can be efficient, but it requires effective monitoring and robust enforcement to deliver market benefits.
Microsoft’s tactical position: defensive fixes, commitments, and product changes
Microsoft has used several tools to address and contain regulatory threats:- Commercial commitments and market-tested remedies. In the Teams case, Microsoft agreed to offer Office suites without Teams at reduced prices, to establish interoperability and data portability mechanisms, and to abide by pricing differentials for a multi‑year period — measures the Commission accepted as adequate to resolve the Teams probe without a fine. These commitments are legally binding under EU processes when accepted.
- Product and installation flow changes. Microsoft has tightened Windows 11 setup flows and disabled previously publicized bypasses that allowed users to create local accounts or install the OS without an internet connection, moves that critics say steer users toward Microsoft Accounts and cloud services such as OneDrive. Those changes are in active testing in Windows Insider channels and have been widely reported by tech outlets. While Microsoft frames the changes as user‑experience and security hardening, the net effect is to make it harder for non‑Microsoft clouds to avoid being engaged during device setup.
- Regional policy calibrations. Microsoft has tailored specific offerings and workflows in response to European regulatory pressure — for example, modifying certain consumer flows and ESU enrollment behaviours in the EEA after consumer and regulatory pushback. This shows Microsoft can and does make market‑specific concessions when regulators press.
Critical analysis — strengths and weaknesses of Nextcloud’s approach
Strengths of Nextcloud’s legal and public campaign
- Focus: Nextcloud’s complaint targets a concrete, operational practice — the bundling and deep integration of OneDrive into Windows — which is easier to explain and rally support around than abstract market metrics.
- Coalition building: By aligning a coalition of smaller European cloud vendors, Nextcloud framed the dispute as not just one vendor’s gripe but a broader industrial grievance about sovereignty, data portability, and EU cloud competitiveness.
- Complementary enforcement routes: Keeping the German action active while withdrawing the EU complaint is a pragmatic allocation of limited resources; national enforcers with specific legal tools can sometimes move faster than EU procedures.
Weaknesses and risks in Nextcloud’s strategy
- Resource asymmetry: Regulatory battles with a technology giant are resource‑intensive. Small vendors like Nextcloud face recurring costs in preparing evidence, responding to questionnaires, and sustaining legal representation — a reality Nextcloud cited as one reason to withdraw at the EU level.
- Dilution of political momentum: Withdrawing from the EU docket reduces the number of formal complainants in Brussels, possibly slowing collective pressure and the political visibility of the issue. That may blunt leverage against Microsoft at the EU level.
- Evidence and antitrust thresholds: Proving exclusionary effects tied directly to bundling requires granular evidence of foreclosure and market harm. The Commission’s preference for commitments suggests it often will opt for negotiated fixes unless the evidence decisively supports a formal infringement ruling. This procedural threshold favors firms with enduring litigation budgets.
What regulators, rivals and customers should watch next
- German enforcement outcomes: The Bundeskartellamt’s ongoing supervision of Microsoft is the most immediate locus of possible remedies or prohibitions in Europe; its actions and any follow‑on decisions will be closely followed by rivals and procurement teams.
- Implementation and monitoring of commitments: Where Microsoft offers commitments (as with Teams), enforcement depends entirely on transparent monitoring, trustee reporting, and Commission willingness to impose large fines for non‑compliance. Market participants should scrutinize implementation fidelity, not just headline promises.
- Product‑level changes that drive behaviour: Changes to Windows OOBE, Microsoft Account requirements, and OneDrive defaults can have the same practical effect as bundling when they make avoiding Microsoft cloud services technically difficult for everyday users. These operational shifts often move faster than regulatory processes and therefore deserve close scrutiny.
- Cross‑jurisdictional enforcement trends: The EU’s DMA, national enforcers (like the Bundeskartellamt), and market actions by rivals (Google’s complaints, CISPE settlements) create a patchwork of pressure points. Outcomes in one jurisdiction will shape strategies elsewhere.
Practical takeaways for IT leaders and procurement teams
- Audit dependencies. Map which workloads and workflows rely on Microsoft‑specific integrations (OneDrive, Teams, Entra/Active Directory hooks, Exchange/SharePoint integration). Quantify the operational cost of decoupling.
- Test portability now. Use available export and interoperability tools (especially as Microsoft rolls out Teams export and migration APIs) to run proof‑of‑concept migrations before contract renewal windows.
- Negotiate contract safeguards. When renewing or entering multi‑year deals, secure explicit audit rights, data export guarantees, and transition assistance clauses, particularly for EEA contracts where regulatory commitments may apply.
- Consider multi‑vendor architectures carefully. A best‑of‑breed approach reduces supplier lock‑in risk but increases integration and operational complexity; plan pilot migrations and validate security and compliance impacts.
- Monitor national enforcement as well as EU developments. A favourable ruling or prohibition at national level (Germany, UK, etc.) can be operationally transformative even without an EU infringement ruling.
Open questions and limits of the public record
- Market share and numerical claims: Nextcloud’s public materials reference statistics (for example, market share shifts attributed to hyperscalers) that are useful illustrators but vary by source and methodology. Such aggregated numbers should be treated cautiously until regulators or independent studies publish rigorous, auditable analyses. Claims about precise percentages or aggregate "taxes" on migration costs are often contested and require transparent methodology to be dispositive.
- Commission’s internal timelines and priorities: The Commission’s internal case prioritisation and resource allocation are not fully public. Nextcloud’s withdrawal underscores that small complainants perceive the EU process as slow; whether that perception reflects temporary case backlogs, prioritisation choices (e.g., Teams/Slack taken forward), or a different docket strategy remains partially opaque.
- Technical parity of interoperability promises: Microsoft’s commitments often include APIs and export tools. Real‑world efficacy — latency, fidelity of exported metadata, permission models, and edge‑case behaviour — will decide whether promised interoperability translates into genuine, low‑friction competition. Independent technical audits and enterprise pilot projects will be necessary to validate promises.
Conclusion — a tactical withdrawal, not a strategic capitulation
Nextcloud’s withdrawal of its EU complaint against Microsoft is a pragmatic response to procedural realities: protracted Commission exchanges, high administrative costs for a small vendor, and the prospect of an indeterminate timeline. But the broader regulatory and market dynamics that sparked the complaint have not evaporated.Germany’s Bundeskartellamt retains enforcement tools and has signalled heightened scrutiny; the EU has demonstrated it can extract binding commitments (as in the Teams case) even if formal infringement findings are rare. On the ground, product changes to Windows 11 and Windows setup flows have already made avoiding Microsoft Accounts and cloud defaults more difficult, a fact that feeds the very competitive concerns Nextcloud raised.
For regulators, the episode raises uncomfortable but necessary questions about how to ensure smaller challengers can engage with EU enforcement mechanisms without being priced out of the process. For enterprises and public procurement officials, it reinforces the value of defensive planning now: auditing dependencies, testing portability tools, and negotiating contractual guardrails can convert regulatory uncertainty into operational resilience.
The fight over bundling and gatekeeping is far from resolved. Nextcloud’s EU withdrawal is tactical — a reallocation of scarce resources — not a renunciation of the underlying claim that dominant platforms can, by design or by slide, distort adjacent markets. The next decisive moves will more likely come from national enforcers’ decisions, the fidelity of Microsoft’s implementation of its commitments, and whether technical interoperability turns from promise into practice.
Quick reference — where to look for updates
- Nextcloud’s announcement and coalition materials (company blog and antitrust site).
- Bundeskartellamt press releases and case file on Microsoft’s Section 19a proceeding.
- European Commission public documents and the market‑test record for the Teams commitments (case file AT.40721 / AT.40873 and press statements).
- Technical reporting on Windows 11 account/OneDrive setup changes (Insider release notes and testing reports).
Source: theregister.com Nextcloud withdraws European Commission OneDrive complaint
