Third Complaint against Microsoft illustrates need for urgent action on abusive software licenses

Mar 17, 2022 | News

Brussels. 17th March 2022. There has been a storm brewing for some time over the unfair use of software licenses by some legacy software publishers to control the cloud infrastructure market. The news broken by the Wall St Journal today merely highlights the need for action against these practices now.

CISPE, alongside other CIOs and provider organisations, campaigned last year to introduce a set of Principles for Fair Software Licensing to address this and won the backing of political and industry supporters. Research by renowned experts Professor Jenny and Professor Metzger further highlighted how legacy software companies, including Microsoft, use of unfair terms to restrict choice and raise costs is damaging to customers and threatens Europe’s own cloud infrastructure providers.  Over 2,500 CIOs from Europe’s leading public and private sector organisations let their voices to calls for action on unfair licensing.

The emergence of a formal competition complaint only serves to underline the seriousness of this situation and the need for urgent and effective action to prevent these abuses.

A second complaint against Microsoft in a matter of months (and the 3rd in just over 18 months) for similar behaviour signals a return to its bad practices of the 1990s. This string of complaints paints a picture of an already dominant company seeking to leverage its monopoly position in productivity software to capture market share in cloud infrastructure by hook or by crook.

If the European Union wants to create strategic autonomy in digital markets it needs strong and competitive European providers of cloud infrastructure services. As the representative of many of these players, CISPE calls on The European Commission to urgently investigate this complaint in the interests of not only European businesses and consumers, but the aspirations of the EU’s Digital Decade.

The existence of this complaint also reiterates the need to ensure productivity software is fully included in the scope of the Digital Markets Act. Without a clear definition, and explicit ruling-in of the software hundreds of thousands of European businesses use every day, there can be no immediate brake on these unfair, damaging practices.

The very fact that plaintiffs felt the need to resort to a formal complaint suggest that faith in the DMA is already fading fast among Europe’s digital market leaders. If the DMA text is not clarified to fully include productivity software, then it will miss a historic opportunity to protect European foundations of the cloud economy and will have failed in its mission to create fair and contestable digital markets.

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