The rivalry between Microsoft (MSFT) and Alphabet’s (GOOGL) Google just escalated. MSFT has accused Google of launching a “shadow campaign” aimed at damaging its reputation and mitigating global regulatory scrutiny. This public dispute highlights the intense competition between Microsoft and Google in the cloud computing market.
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Importantly, these accusations come after Google filed an antitrust complaint against Microsoft in Europe last month. In its complaint, Google alleged that MSFT engaged in unfair licensing practices related to its Azure cloud services. However, Microsoft argues that Google’s actions are merely an attempt to distract regulators from its rising legal challenges.
Microsoft Blasts Google for Deceptive Tactics
In a recent blog post, Microsoft’s Deputy General Counsel, Rima Alaily, claimed that Google is secretly backing an astroturf campaign. Astroturfing is the deceptive practice of creating fake support to manipulate public opinion. According to Alaily, this campaign aims to mislead the public, policymakers, and regulators about MSFT’s business practices and reputation.
Alaily alleges that Google has taken extensive measures to conceal its involvement in the group, recruiting European cloud providers to serve as a public face.
In addition, Alaily stated that Google has been using other tactics to damage Microsoft’s image, which includes paying commentators to spread negative narratives. Moreover, she pointed out that Google has previously criticized Microsoft on various issues, including cybersecurity and its business in China.
Microsoft Challenges Google’s ‘Small Player’ Claim
In addition, Microsoft challenges Google’s claim of being a smaller player in the cloud market. Microsoft points out that Google has a huge data center capacity of 3,500 MW and saw 29% growth in its cloud business last quarter. It also highlights Google’s large infrastructure investments as proof of its strong position in the market.
Microsoft raised concerns that Google’s portrayal as a small cloud provider could be a tactic to gain regulatory support to its advantage. Google has been actively lobbying regulators to limit the influence of major cloud players like Amazon’s (AMZN) AWS and Microsoft, while also seeking exemptions from these regulations for itself.
The escalating tensions between these tech giants reflect the fierce competition within the cloud computing space. While the truth behind Microsoft’s accusations remains to be seen, this public battle is likely to have significant implications for both companies.
Which Is Better, Alphabet or Microsoft?
On TipRanks, both GOOGL and MSFT carry a Strong Buy consensus rating. Regarding share price growth over the next 12 months, analysts anticipate an upside potential of 20.89% for GOOGL and 17.95% for MSFT.
