Microsoft has struck a deal with Cloud Infrastructure Services Providers in Europe (CISPE) to settle claims the company is unfairly leveraging its ecosystem in cloud licensing.

CISPE filed an EU complain in late 2022, alleging that Microsoft was “irreparably damaging” the EU cloud industry. The company was accused of leveraging its Windows and Office dominance to force companies to adopt its cloud services, rather than use options from competing solutions. Microsoft announced changes to address the issues at the time, but CISPE said the proposed solutions didn’t go far enough and were little more than an attempt by the Redmond company to stave off a formal EU investigation.

“CISPE members represent the vibrant, autonomous and independent foundations of Europe’s digital transformation and growth. We have filed this sector complaint to rectify the harms suffered by vendors and customers alike as a result of unfair software licensing practices,” Francisco Mingorance, Secretary General of CISPE, said at the time. “Leveraging its dominance in productivity software, Microsoft restricts choice and inflates costs as European customers look to move to the cloud, thus distorting Europe’s digital economy. DG Comp must act swiftly to open a formal investigation with a statement of objections against Microsoft’s software licence abuses to defend the robust cloud ecosystem Europe needs and deserves.”

Microsoft and CISPE have finally reached an agreement, one that will see CISPE withdraw its EU complaint against Microsoft. Because the complaint was on behalf of smaller cloud providers, AWS was excluded from the negotiations despite being a CISPE member, and neither AWS nor Google Cloud will benefit from the terms agreed upon.

The agreement between the two parties will give European cloud providers the ability to offer Azure and Microsoft-based features that would normally be reserved for Microsoft customers.

Central to the agreement is a collaboration between the parties to release an enhanced version of Azure Stack HCI for European cloud providers (Azure HCI Stack for Hosters) to offer features that Microsoft customers using Azure Stack HCI enjoy today. These features include:

• Multi-session virtual desktop infrastructure based on Windows 11
• Free Extended Security Updates (ESU)
• Pay-as-you-go licensing for SQL Server.

This collaboration will enable European Cloud providers to offer Microsoft applications and services on their local cloud infrastructures, meeting the demand for sovereign cloud solutions and addressing the disruption experienced by European cloud providers and their customers following Broadcom’s acquisition of VMware.

The European Cloud Observatory (ECO) will also be established by CISPE, and include Microsoft, to monitor the solution and ensure compliance.

“This is a significant victory for European cloud providers,” said Secretary General Mingorance. “CISPE has given Microsoft the benefit of the doubt and believes that this agreement will provide a level playing field for European cloud infrastructure service providers and their customers. Microsoft has nine-months to make good on its commitment by offering solutions that allow fair licensing terms for its productivity software European cloud infrastructures.

“To ensure the continued primacy of European members, the CISPE General Assembly has also instructed the Board to revise the governance of the association to ensure that European businesses and SMEs remain in the driving seat for CISPE campaigns should Microsoft or other global hyperscalers ask to become members. Proposed modifications will be presented ahead of the next General Assembly on 18th October 2024.”