Google Offered $500 Million to Derail Microsoft’s CISPE Deal

Google went all-in in its efforts to derail Microsoft’s deal with the EU’s CISPE, offering $500 million in an effort to stop it. Microsoft recently struck a deal with Cloud Infrastructure ...
Google Offered $500 Million to Derail Microsoft’s CISPE Deal
Written by Matt Milano
  • Google went all-in in its efforts to derail Microsoft’s deal with the EU’s CISPE, offering $500 million in an effort to stop it.

    Microsoft recently struck a deal with Cloud Infrastructure Services Providers in Europe (CISPE) to settle a complaint that the Redmond giant was “irreparably damaging” the EU cloud industry. The deal paved the way for EU cloud providers to offer the same Microsoft and Azure applications and services that would normally require being a direct Microsoft customer.

    According to Bloomberg, via Ars Technica, Google offered a $500 million deal, including $15 million in cash, in an effort to stop Microsoft’s deal. The majority of the package included software licenses for a five-year period.

    CISPE spokesperson, Ben Maynard, told Ars the “members were presented with alternative options to accepting the Microsoft deal.”

    Maynard didn’t elaborate on what the alternatives were, but did say Microsoft’s deal won by a wide margin.

    “However, the members voted by a significant majority to accept the Microsoft offer, which, in their view, presented the best opportunity for the European cloud sector,” Maynard told Ars.

    Because CISPE’s original complaint was aimed at protecting EU cloud providers, neither AWS nor Google Cloud will benefit from the agreement, and AWS was excluded from the negotiations despite being a member of CISPE.

    Google wasted no time voicing its disapproval of the deal, with Google Cloud VP Amit Zavery saying Microsoft’s deal was little more than a payoff.

    MSFT playbook of paying off complainants rather than address their complaints shouldn’t fool anyone. The deal doesn’t apply to all CISPE members. CISPE admits to a payoff. EU cloud competitors become Azure customers. CISPE members under gag order, can’t file complaints anymore.

    Given the lengths to which Google was trying to go to derail Microsoft’s CISPE deal, Zavery’s salty comments make far more sense.

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