Google wants regulators to break up Microsoft's OpenAI deal

Google has asked the US Federal Trade Commission (FTC) to break up Microsoft’s partnership with OpenAI over competition concerns.

The firm is asking the regulator to examine an exclusive agreement that ensures OpenAI’s technology is hosted on Microsoft’s cloud platform, reports from The Information suggest.

A conversation over the potential move occurred after the FTC asked Google about business practices at Microsoft as part of a wider investigation, the report said. The source cited was a person directly involved in the conversation.

The report said companies such as Google want to host OpenAI’s models on their cloud servers so that customers don’t need to rely on Microsoft for access.

Customers using OpenAI’s technology via Microsoft may face additional charges if they are not already Microsoft customers and using the firm’s servers, the conversation also revealed.

Google, along with other competitors, has highlighted that these additional charges will be damaging to customers.

Google’s puts the pressure on Microsoft

The move by Google marks the latest in a series of attempts by Google to disrupt Microsoft's alleged anti-competitive practices in the broader cloud computing industry and the generative AI space.

Google has been a vocal critic of Microsoft's practices in recent years, having taken a series of jabs at its long-time rival.

Most significant has been Google's aggressive stance on Microsoft’s cloud and software licensing regimes.

In February 2024, Google Cloud VP Amit Zavery hit out at Microsoft, suggesting it was pursuing a monopoly in the industry that could harm long-term competition.

Microsoft has been subject to intense regulatory scrutiny in the EU, and was locked in an intense battle with CISPE over its cloud computing practices, which the organization described as anti-competitive.

In July this year, Google reportedly offered a $512 million sweetener to CISPE in a bid to scupper a deal between the trade body and Microsoft to end a long-running lawsuit.

The attempt failed, however, and Microsoft has since settled with the organization.

The issue was not put to bed here though, with Zavery labeling the settlement a “payoff.”

Google also recently filed another complaint with the EU on this matter, doubling down on the accusation of Microsoft's anti-competitive cloud practices in the market.

Criticism of Microsoft hasn't been entirely restricted to its activities in the cloud industry, however.

In May, Google criticized Microsoft for its "inadequate security culture" after a series of email security blunders saw Chinese-backed threat actors gain access to communications between US government officials.

The scathing critique suggested Microsoft can't be trusted on cybersecurity matters, and urged organizations to consider alternative productivity platforms, such as its own Workspace service.