Google accused of shadow campaigns redirecting antitrust scrutiny to Microsoft

On Monday, Microsoft came out guns blazing, posting a blog accusing Google of "dishonestly" funding groups conducting allegedly biased studies to discredit Microsoft and mislead antitrust enforcers and the public. In the blog, Microsoft lawyer Rima Alaily alleged that an astroturf group called the Open Cloud Coalition will launch this week and will appear to be led by "a handful of European cloud providers." In actuality, however, those smaller companies were secretly recruited by Google, which allegedly pays them "to serve as the public face" and "obfuscate" Google's involvement, Microsoft's blog said. In return, Google likely offered the cloud providers cash or discounts to join, Alaily alleged. The Open Cloud Coalition is just one part of a "pattern of shadowy campaigns" that Google has funded, both "directly and indirectly," to muddy the antitrust waters, Alaily alleged. The only other named example that Alaily gives while documenting this supposed pattern is the US-based Coalition for Fair Software Licensing (CFSL), which Alaily said has attacked Microsoft's cloud computing business in the US, the United Kingdom, and the European Union. That group is led by Ryan Triplette, who Alaily said is "a well-known lobbyist for Google in Washington, DC, but Google’s affiliation isn’t disclosed publicly by the organization." An online search confirms Triplette was formerly a lobbyist for Franklin Square Group, which Politico reported represented Google during her time there. Ars could not immediately reach the CFSL for comment. Google's spokesperson told Ars that the company has "been a public supporter of CFSL for more than two years" and has "no idea what evidence Microsoft cites that we are the main funder of CFSL." If Triplette was previously a lobbyist for Google, the spokesperson said, "that's a weird criticism to make" since it's likely "everybody in law, policy, etc.," has "worked for Google, Microsoft, or Amazon at some point, in some capacity." Google's "shadowy campaign" also includes hiring supposedly neutral experts, including industry commentators and academics, to "attack Microsoft and author 'studies' that can be cited to discredit us," Alaily alleged. Alaily said that Google's plan with these groups and other activities was to "distract from the intense regulatory scrutiny Google is facing around the world by discrediting Microsoft and tilt the regulatory landscape in favor of its cloud services rather than competing on the merits." Google is seemingly lashing out at Microsoft, Alaily claimed, because Google is "facing a reckoning," with "at least 24 antitrust investigations" circling its business on all sides. "At a time when Google should be focused on addressing legitimate questions about its business, it is instead turning its vast resources towards tearing down others," Alaily wrote. "It is disappointing that, with the foundation of their business facing jeopardy, they have sought to bolster their cloud computing service—Google Cloud Platform—by attacking ours." Google's spokesperson told Ars that Google has legitimate concerns about Microsoft's cloud business. "We’ve been very public about our concerns with Microsoft’s cloud licensing," Google's spokesperson said. "We and many others believe that Microsoft’s anticompetitive practices lock in customers and create negative downstream effects that impact cybersecurity, innovation, and choice. You can read more in our many blog posts on these issues."

Microsoft warned by potential recruit

This fight between Google and Microsoft appears to have kicked up after Google fought to maintain an antitrust complaint filed by a group called the Cloud Infrastructure Service Providers in Europe (CISPE) against Microsoft's cloud business in the European Union. Microsoft claimed that Google had hoped to "weaponize" CISPE during that complaint process. In July, Google went so far as to offer CISPE "a combination of cash and credits amounting to an eye-popping $500 million" to derail a Microsoft settlement, Alaily noted, but it didn't work. After CISPE "wisely declined" to play Google's alleged game, Google apparently was motivated to form its own group of cloud providers to help the tech giant challenge Microsoft cloud services in the EU and UK. CISPE did not immediately respond to Ars' request to comment. Additionally, Google filed its own complaint with the European Commission in September over Microsoft's Azure cloud platform. In a blog, Google alleged that Microsoft’s licensing terms were anticompetitively written to "restrict European customers from moving their current Microsoft workloads to competitors’ clouds—despite there being no technical barriers to doing so—or impose what Microsoft admits is a striking 400 percent price markup." Microsoft has defended its software licensing practices, accusing Google of arguing that "it should not have to pay Microsoft when it builds and offers cloud services using our intellectual property." According to Alaily, Microsoft learned more about the Open Cloud Coalition launching this week after one of the companies that Google allegedly approached as a potential member squealed to Microsoft that "the organization will be directed and largely funded by Google for the purpose of attacking Microsoft’s cloud computing business" in the EU and UK. Alaily shared the recruiting document for the group, noting that it doesn't mention Google or Microsoft, only innocuously claiming that its mission is to "create a fairer, more resilient cloud market." As Microsoft sees it, Google is attacking Microsoft to distract regulators who continue to threaten to dismantle its core businesses in search and online advertising. On top of challenging various aspects of Microsoft's cloud business in the EU, Google allegedly also distributed a "misleading" fact sheet in Washington, DC, "attempting to drum up concerns" about Microsoft's "approach to the China market." "Google’s work on this range of topics underscores the fact that it is less concerned about Microsoft’s conduct in the cloud market than it is with discrediting a competitor wherever it can get a foothold," Alaily alleged.