Google promised EU companies tens of millions of euros to make Microsoft bleed
Google apparently wanted to use a gigantic “gift” to prevent Microsoft from escaping a potentially costly fine from the EU competition authorities. To this end, it offered a group of European companies products worth hundreds of millions of euros. Ofcom
European companies should pursue complaints
According to a report by the US Economic Service Bloomberg which is based on EU documents and sources close to the parties involved, Google wanted to get the companies in the lobby group CISPE to maintain their complaint about an alleged abuse of market power in cloud services by Microsoft. CISPE (Cloud Infrastructure Service Providers in Europe) is an association of companies to which various hosts and cloud infrastructure providers belong. The group had filed a complaint with the EU competition authorities some time ago because they suspected an illegal bundling of Microsoft’s business software with the US software giant’s Azure cloud services in Europe.
Last week, however, the lobby group withdrew the complaint because it had agreed with Microsoft to gain easier access to the company’s technologies in order to be able to market them to corporate customers together with its own cloud services. Google apparently wanted to prevent this at all costs.
Google lured with almost 470 million euros
In total, Google is said to have offered the companies from the CISPE association its own products worth 455 million euros in the form of licenses for cloud technology and the like. In addition, 14 million euros were promised as part of a long-term partnership with Google, it is said. In total, Google lured them with a sum of 469 million euros. Amazon, for its part, as a member of CISPE, also wanted to contribute around six million euros, it is said. The condition for such a deal, however, was that CISPE did not withdraw its complaint to the EU. Google only announced on the subject that it had negotiated joining the group and, as part of these talks, had made offers about how the US company could get involved. All that was heard from CISPE was that it had ultimately decided to agree on a cooperation with Microsoft.
According to the Bloomberg report, CISPE will receive a “financial contribution” of ten million euros from Microsoft in addition to the admissions regarding the distribution of its products via the cloud infrastructure of European companies. It is not unusual for Microsoft to try to reach an agreement with potential competitors or complainants outside of the regulators and courts of the world. For example, in 2004 it paid almost 10 million dollars to an industry association supported by Google in order to get the group to drop a complaint with the EU. It all sounds like a lot of haggling, doesn’t it? But that’s probably how it is in the world of lobbyists and technology companies, or what do you think?
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