"Google Fake Propaganda" vs "MS Anticompetitive"... Big Tech Intensifies Negative War

Ongoing Clash Between MS and Google
MS: "Google Restricts Competition Through Lobby Groups"
Google: "MS Engages in Anticompetitive Practices"

Are Regulators Intensifying Attacks on Competitors?

"Google is engaging in a cutthroat propaganda campaign against Microsoft (MS)."

"MS's anti-competitive practices are negatively impacting not only consumers but also innovation."

The negative strategies between MS and Google are intensifying. Amid ongoing crackdowns by major competition authorities on US big tech companies, concerns that massive fines and forced divestitures could shrink market influence are fueling intensified targeting of competitors.

MS: "Google Organized Lobby Group to Undermine MS's Credibility"

Rima Alaily, MS Deputy General Counsel, stated on her blog on the 28th (local time), "The 'Open Cloud Coalition' organized by Google is launching this week," adding, "It was established with the purpose of undermining MS's credibility and misleading the public to competition authorities and policymakers." She referred to this lobbying group as an astroturf (fake propaganda) organization secretly supported by Google.

Alaily explained that she learned of this fact through a whistleblower from a company invited to join the lobbying group. Although the coalition's statement introduces itself as "formed to advocate for a fair, competitive, and open cloud services industry across the UK and the European Union (EU)," Alaily claims it was created to induce regulatory changes favorable to Google's own cloud services.

Google did not deny the claim. A Google spokesperson emphasized, "Many, including ourselves, see MS's anti-competitive practices as locking in customers and negatively impacting cybersecurity, innovation, and choice."

Google Reported MS to EU Last Month for Antitrust Violations

Earlier, last month, Google reported MS to the EU for antitrust violations, alleging that MS's cloud services restrict fair market competition. Google claimed that MS uses unfair licensing agreements with penalty-like terms to limit competition in the multi-billion-dollar cloud computing market, causing significant harm to European companies and governments.

At the time, MS responded, "We anticipated Google's lawsuit and have addressed similar concerns raised by European cloud providers amicably," adding, "Having failed to persuade European companies, we expect Google will also fail to convince the EU." Regarding this, Deputy General Counsel Alaily asserted, "Despite Google providing substantial cash and credits to European cloud providers, their eventual agreement with MS in July sparked backlash, leading to their support in establishing the Open Cloud Coalition."

Changed Regulatory Environment Since the 2020s?

Big tech companies have been evaluated as achieving rapid growth over more than 20 years in a relatively free environment where regulations lagged behind industry development speed. As a result, monopolistic companies emerged in various fields such as search and online advertising, e-commerce, social networking services (SNS), and cloud computing.

However, entering the 2020s, major competition authorities in the US, EU, and elsewhere, concerned about fierce competition, filed lawsuits against these companies, drastically changing the external environment. As astronomical antitrust fines and market share declines due to corporate breakups became a reality, it is analyzed that these companies have started to disparage competitors. Major foreign media also described Deputy General Counsel Alaily's remarks as "unusual and blunt." The two big tech companies also clashed during the Google antitrust trial in October last year. At that time, MS CEO Satya Nadella testified, saying, "Google is likely to extend its search market dominance to next-generation AI-based tools," while Google countered that Bing (MS's search engine) is an inferior product falling behind Google.

Both big tech companies are awaiting final outcomes of several antitrust investigations. Google is awaiting the conclusion of the US Department of Justice's proposal to the court to divest parts of Google's business. MS is awaiting the EU's final decision regarding its practice of bundling the collaboration software Teams. If confirmed, MS could face fines up to 10% of its global annual revenue.