UK prime minister Keir Starmer promised to make the nation’s competition regulator more inclined toward economic growth the day after a Microsoft executive was appointed chair of the government’s Industrial Strategy Advisory Council.
At the UK’s International Investment Summit, attended by Google owner Alphabet, insurance group Aviva, and pharma giant GSK, Starmer said it was time to “upgrade the regulatory regime” and make it “fit for the modern age.”
“We will rip out the bureaucracy that blocks investment,” he said. “We will march through the institutions and we will make sure that every regulator in this country – especially our economic and competition regulators – takes growth as seriously as this room does.”
Competitors to Microsoft and Google might point out that UK regulators can also promote growth by curbing monopolies.
The Redmond tech giant is one of the companies under the scrutiny of the Competition and Markets Authority (CMA) as it continues to investigate the health of the local cloud market.
But that was not the theme of this week’s event, which was preceded by the appointment of Clare Barclay, CEO of Microsoft UK, as chair of the government’s new Industrial Strategy Advisory Council, which is said to offer the government expert advice in partnership with business, unions, and other groups from across the UK.
In a prepared statement, Barclay said she would ensure the council provides a “clear and strong voice on behalf of business, nations, regions, and trade unions, as we invest for the future to ensure that our prosperity is underpinned by robust growth in key sectors right across the country.”
In June, the CMA reported that the majority of concerns raised in submissions it received in its cloud market investigation related to Microsoft.
In a series of consultative papers, the CMA said its emerging view was that Microsoft has significant market power thanks to its software products, including Windows Server, Windows 10 and 11, SQL Server, Visual Studio, and its productivity suites, which organizations widely use. It found that Microsoft’s licensing practices have an effect on which cloud provider a customer chooses, at least when it comes to running Microsoft workloads, the CMA said.
Respondents told the CMA that there are differences between using Microsoft products on Azure compared to other clouds as a result of bring your own license (BYOL) restrictions that prevent customers taking advantage of license portability to clouds operated by listed providers, which include AWS, Google, and Alibaba.
In response, a Microsoft spokesperson told The Register: “Our licensing terms enable our customers and other cloud providers to run and offer Microsoft software on every cloud. While the licensing terms for hyperscaler providers Amazon Web Services and Google Cloud are different, Microsoft’s software is available in their clouds as well, and as recent earnings reports demonstrate, both continue to compete effectively and grow cloud revenue rapidly.”
A legal professional in the UK voiced concerns about potential conflict of interest in hiring a Microsoft exec to work in a public sector role.
“Leaving aside the crass stupidity of appointing the UK head of a US HQ’ed global supplier under ongoing active investigation by the CMA for alleged manipulation of their market share, the gov[ernment] have arguably both sent a clear message of their faith and dependency on Microsoft AND dealt the CMA’s investigation a crashing blow,” he told The Reg.
“If CMA don’t chastise Microsoft then the role now played by… Barclay will of course be leveraged to suggest political interference, whereas if they do, her position becomes immediately untenable, and affects the gov[ernment]’s flagship plan.
“Maybe this is a precursor to a significantly less harsh outcome all round for all the hyperscalers under CMA examination – only that outcome would conveniently spare the gov[ernment]’s blushes and let their normal cloud service purchases resume unabated.” ®