The fact that Amazon Web Services (AWS) seems to be able to conclude more cloud contracts with American authorities seems to irritate those responsible at Microsoft. According to a Wall Street Journal (WSJ) report the software group is calling on other cloud competitors such as Google and Oracle to join forces against Amazon to break the cloud leader’s dominance.
Microsoft has started its lobbying machine for this, the newspaper reports, citing insiders and forwarded documents. As a result, the software group, together with its allies, wants to ensure that large cloud projects no longer go to one provider, but are spread across multiple cloud platforms. In addition to Google and Oracle, Microsoft is said to have approached industry heavyweights such as VMware, Dell, IBM and HPE with a request for support.
Amazon has dominated the cloud infrastructure market with AWS for years. According to Gartner, the online company had a global market share of 39 percent last year. Microsoft follows with its Azure cloud and a share of 21 percent in second place by a clear margin. Also in the North American business, AWS is clearly at the forefront with cloud services for governments. According to Gartner, the online retailer leads here by 47 to 28 percent over Microsoft.
Little has changed in these power relations over the years. Apparently this is causing more and more frustration at Microsoft headquarters, the WSJ reports, citing sources who are said to be in the know. As a result, they want to break the rivalry supremacy in Redmond with pleas and calls for multi-cloud. A paper entitled “Multi-Cloud Vision Statement and Principles” is already in the drawer and awaiting publication.
“We are concerned that U.S. government departments and agencies (…) have failed to comply – albeit inadvertently – with legal and regulatory rules regarding multiple procurement and industry best practices,” quotes GeekWire from the Microsoft document, which is available for the online magazine. Single-cloud purchases should remain the exception and should only be the method of choice if the need is truly justified. Instead, a multi-cloud policy would improve competition, reduce costs and encourage innovation, the letter concludes.
What the Redmond company deliberately ignores: The multi-cloud appeal is only related to the infrastructure and platform offerings. Software-as-a-Service offerings are omitted. A recent study, funded in part by Google, found that Microsoft controls 85 percent of the U.S. public sector productivity software market. The Google research also warns against “over reliance on one provider”.
An Amazon spokesperson called Microsoft’s lobbying at the WSJ a self-service campaign that could lead to customers being forced to use the inferior technology. “Public sector customers should have the freedom and flexibility to choose how to purchase secure, reliable and cost-effective cloud services and software from the vendor(s) of their choice – without coercion or unfair software licensing restrictions,” Amazon said. said -Speaker.
Oracle, meanwhile, has sided with Microsoft and said it supports the effort. “Microsoft is rightly committed to a multi-cloud strategy in administration,” said the US newspaper Ken Glueck, executive vice president at Oracle. “We wholeheartedly support this effort.”
The skirmishes between the cloud players underline how important the cloud has become to the business of the IT giants and how fierce the battle for megadeals is. Good example: the Joint Enterprise Defense Infrastructure (JEDI) project of the US Department of Defense. Value: about ten billion dollars. The favorite for the track has long been AWS. Even taunts from Oracle, which was already out of business, didn’t stop everything in the Pentagon pointing to Amazon as the cloud provider.
But shortly before the official ceremony, then-US President Donald Trump threw a spanner in the works. He ordered his defense secretary, Mark Esper, to reconsider the deal. The background: Trump’s private vendetta with Amazon founder Jeff Bezos, whose newspaper, the Washington Post, had repeatedly and massively criticized the Republican president. In the end, Microsoft got the JEDI deal.
But even those responsible for Microsoft couldn’t be happy about it for long. The JEDI project was completely overthrown in July 2021 and replaced by the Joint Warfighter Cloud Capability (JWCC) project. According to the Pentagon’s guideline, multiple cloud providers should come into play here – just as Microsoft’s multi-cloud convention is now being promoted.
In Europe, competition disputes in the US cloud business are likely to be closely monitored – not least by the antitrust authorities. Last year, French provider OVHCloud and a coalition around Nextcloud, a developer and provider of free software for use in the cloud, filed a complaint with European competition authorities. The allegations centered on how Microsoft is increasingly integrating products such as Microsoft 365 and Windows with other software and service products. “That makes it almost impossible to compete with your own SaaS services,” they accuse Microsoft.
The software company admitted mistakes and promised improvement. Those responsible for Microsoft promised they would adjust their own business practices and licensing statistics. Here too, the group worked as a kind of self-commitment to a public document. Microsoft has also announced five principles that will guide all cloud companies in the future.
The competition authorities will closely monitor the group’s compliance with these. One must take the control seriously, Andreas Mundt, chairman of the Federal Cartel Office, said in the spring of this year. “The legislative mechanism to safeguard competition is in effect worldwide.” The German competition authorities have the cloud market on their radar. Referring to complaints from European cloud providers, Mundt said, “Microsoft is a long-time customer of the competition authorities.”