Cloud service competition escalates as Microsoft "attacks" Google with a shadow campaign to smear its reputation in Europe

According to the financial news app Zhitong Finance, Microsoft (MSFT.US) publicly accused its long-term competitor Google (GOOGL.US) of conducting shadow campaigns in Europe on Monday, aiming to damage the software giant's reputation with regulatory authorities.

Rima Allee, Deputy General Counsel at Microsoft, published an article accusing Google of using unfair tactics to attack Microsoft. Microsoft stated that Google is still lobbying competition regulators around the world, directly or indirectly, to impose restrictions on large cloud service providers. A Google spokesperson responded, stating that Microsoft's anti-competitive practices lock in customers, create negative effects, and impact network security, innovation, and choice.

Allee wrote, "This week, Google organized a fake organization. The purpose of this organization is to tarnish Microsoft's reputation in the minds of competition regulators and policymakers, and mislead the public."

This conflict represents a new round of competition between the two companies in cloud infrastructure, online advertising, and productivity software.

Google is facing increasing regulatory pressure in Europe and the United States, and the company is currently facing its second antitrust trial brought by the U.S. Department of Justice.

In her post on Monday, Allee hinted that Google had hired the consulting firm DGA Group to establish the Open Cloud Alliance. Allee wrote that a company that chose not to join the organization told Microsoft that the alliance would receive financial support from Google and criticized Microsoft's practices in Europe.

Allee attached a flyer for the Open Cloud Alliance. The overview in the attachment states that the alliance was established to advocate for a fair, competitive, and open cloud services industry in the UK and the EU.

This complaint was made after Microsoft reached a settlement with the European cloud infrastructure group CISPE regarding its licensing practices. Google had attempted to offer the organization's members $500 million in cash and credit to reject the settlement and file a lawsuit.

"They wisely declined. Instead, the members approved the resolution we jointly formulated," Allee pointed out.

She also accused Google of paying commentators to smear Microsoft and attacking Microsoft on topics ranging from cybersecurity to its business in China.

Allee stated that this may divert attention from the reckoning Google is about to face, as Google is facing at least 24 antitrust investigations globally