EU cloud gang wins Microsoft concessions, but fair software licensing group brands them 'stalling tactic'
(2025/07/18)
- Reference: 1752818416
- News link: https://www.theregister.co.uk/2025/07/18/cispe_microsoft_concessions/
- Source link:
A trade group of European cloud providers has claimed a small victory in bringing lower prices and more flexibility in deploying Microsoft software on their infrastructure, though the Coalition for Fair Software Licensing has blasted it as a "stalling tactic" by the software giant.
Cloud Infrastructure Services Providers in Europe (CISPE) said the agreement meant that members could offer Microsoft software to their customers on a pay-as-you-go basis via Microsoft's Cloud Solution Program (CSP-H), allowing stronger privacy for customers of European cloud providers.
However, the agreement has failed to remove the technical tie-in between Entra ID (formerly Azure Active Directory) and Microsoft 365, restricting users in their choice of ID management when deploying Microsoft software in the cloud.
[1]
Microsoft and CISPE have made the agreement more than [2]two years after the trade group filed a formal competition complaint with the European Commission when Microsoft failed to satisfy its demands for fairer licensing practices for users of cloud providers in Europe.
[3]
[4]
As a result of the new deal, CISPE members can use pay-as-you-go licensing models including Windows Server and SQL Server at "competitive pricing that is comparable to Azure," on top of the Flexible Virtualization Benefit already offered to CSP-H partners. A Microsoft 365 Local package is set to allow CISPE members to deploy the suite of software to customers, pending its general availability in Microsoft's Cloud Solution Program.
Lastly, the trade group said it had secured a customer privacy agreement meaning CISPE members can host Microsoft workloads as pay-as-you-go for their customers without sharing customer details with Microsoft.
[5]
As well as benefits within the deal, CISPE has contributed to lobbying for changes to Microsoft licensing, which it says could benefit all European customers and cloud service providers (CSPs). They include CSP-Hoster, designed to mitigate price discrimination between Azure direct sales and existing licensing programs. Also in this bracket are Bring-Your-Own-License deals on European CSP platforms, a so-called Flexible Virtualization Benefit.
Mikkel Naesager, CISPE executive advisor on business models, said the deal and wider lobbying is about gaining as much freedom of choice as possible. "With these elements, you get more freedom of choice, and if you have an existing license, Flexible Virtualization Benefit allows you to choose a European provider without having to purchase licenses. The Microsoft 365 Local offers a modern alternative to on-prem Exchange and other solutions."
[6]Microsoft offers EU cloud providers fresh commercial terms, staves off risk of litigation
[7]Cloud lobby warns EU: Clamp down on water rules and we'll evaporate
[8]Microsoft blows deadline for special Azure for EU hosters
[9]Legal clock ticking for Microsoft over alleged software license abuses
However, CISPE is yet to secure an arrangement for ID management. The technical tie between Entra ID/Azure Active Directory remains in place for European cloud providers.
Naesager said: "If you want to use Microsoft 365 services, for instance, you have to use Entra ID to activate them. There's no ability to have a competing identity management and swap it out. We have been unable to make any headway there."
Not everyone is impressed with Microsoft's concessions. Ryan Triplette, Executive Director of the Coalition for Fair Software Licensing, opined: "Every stalling tactic has just bought Microsoft more time to lock in customers with restrictive and anticompetitive licensing practices. This is more smoke and mirrors from Microsoft: offer weak concessions in an attempt to avoid regulatory scrutiny and disingenuously pretend these actions promote European competition. Meanwhile, Microsoft continues to line its pockets at the expense of customer choice around the world."
[10]
In 2022, under threat of a public review of its licensing practices by the European Commission, Microsoft introduced Flexible Virtualization, allowing customers with Software Assurance (SA) or subscription licenses to use licensed software to build and/or install systems and run them on any cloud providers' infrastructure, also adding an option that allows Windows Server to be licensed on virtual cores.
Microsoft also eliminated the Virtual Desktop Application add-on license for Microsoft 365's F3, E3, and E5 bundles, and customers were given the choice of one and three-year subscriptions for products including Windows Server, Remote Desktop Services, and SQL Server via the Cloud Solution Provider Program. ®
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[2] https://www.theregister.com/2022/11/09/cispe_ec_microsoft_complaint/
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[6] https://www.theregister.com/2025/07/11/microsoft_offers_eu_cloud_providers/
[7] https://www.theregister.com/2025/06/30/cispe_eu_water_resilience/
[8] https://www.theregister.com/2025/05/16/cispe_and_microsoft_abandon_dreams/
[9] https://www.theregister.com/2025/04/07/legal_clock_ticking_for_microsoft/
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Cloud Infrastructure Services Providers in Europe (CISPE) said the agreement meant that members could offer Microsoft software to their customers on a pay-as-you-go basis via Microsoft's Cloud Solution Program (CSP-H), allowing stronger privacy for customers of European cloud providers.
However, the agreement has failed to remove the technical tie-in between Entra ID (formerly Azure Active Directory) and Microsoft 365, restricting users in their choice of ID management when deploying Microsoft software in the cloud.
[1]
Microsoft and CISPE have made the agreement more than [2]two years after the trade group filed a formal competition complaint with the European Commission when Microsoft failed to satisfy its demands for fairer licensing practices for users of cloud providers in Europe.
[3]
[4]
As a result of the new deal, CISPE members can use pay-as-you-go licensing models including Windows Server and SQL Server at "competitive pricing that is comparable to Azure," on top of the Flexible Virtualization Benefit already offered to CSP-H partners. A Microsoft 365 Local package is set to allow CISPE members to deploy the suite of software to customers, pending its general availability in Microsoft's Cloud Solution Program.
Lastly, the trade group said it had secured a customer privacy agreement meaning CISPE members can host Microsoft workloads as pay-as-you-go for their customers without sharing customer details with Microsoft.
[5]
As well as benefits within the deal, CISPE has contributed to lobbying for changes to Microsoft licensing, which it says could benefit all European customers and cloud service providers (CSPs). They include CSP-Hoster, designed to mitigate price discrimination between Azure direct sales and existing licensing programs. Also in this bracket are Bring-Your-Own-License deals on European CSP platforms, a so-called Flexible Virtualization Benefit.
Mikkel Naesager, CISPE executive advisor on business models, said the deal and wider lobbying is about gaining as much freedom of choice as possible. "With these elements, you get more freedom of choice, and if you have an existing license, Flexible Virtualization Benefit allows you to choose a European provider without having to purchase licenses. The Microsoft 365 Local offers a modern alternative to on-prem Exchange and other solutions."
[6]Microsoft offers EU cloud providers fresh commercial terms, staves off risk of litigation
[7]Cloud lobby warns EU: Clamp down on water rules and we'll evaporate
[8]Microsoft blows deadline for special Azure for EU hosters
[9]Legal clock ticking for Microsoft over alleged software license abuses
However, CISPE is yet to secure an arrangement for ID management. The technical tie between Entra ID/Azure Active Directory remains in place for European cloud providers.
Naesager said: "If you want to use Microsoft 365 services, for instance, you have to use Entra ID to activate them. There's no ability to have a competing identity management and swap it out. We have been unable to make any headway there."
Not everyone is impressed with Microsoft's concessions. Ryan Triplette, Executive Director of the Coalition for Fair Software Licensing, opined: "Every stalling tactic has just bought Microsoft more time to lock in customers with restrictive and anticompetitive licensing practices. This is more smoke and mirrors from Microsoft: offer weak concessions in an attempt to avoid regulatory scrutiny and disingenuously pretend these actions promote European competition. Meanwhile, Microsoft continues to line its pockets at the expense of customer choice around the world."
[10]
In 2022, under threat of a public review of its licensing practices by the European Commission, Microsoft introduced Flexible Virtualization, allowing customers with Software Assurance (SA) or subscription licenses to use licensed software to build and/or install systems and run them on any cloud providers' infrastructure, also adding an option that allows Windows Server to be licensed on virtual cores.
Microsoft also eliminated the Virtual Desktop Application add-on license for Microsoft 365's F3, E3, and E5 bundles, and customers were given the choice of one and three-year subscriptions for products including Windows Server, Remote Desktop Services, and SQL Server via the Cloud Solution Provider Program. ®
Get our [11]Tech Resources
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[2] https://www.theregister.com/2022/11/09/cispe_ec_microsoft_complaint/
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[6] https://www.theregister.com/2025/07/11/microsoft_offers_eu_cloud_providers/
[7] https://www.theregister.com/2025/06/30/cispe_eu_water_resilience/
[8] https://www.theregister.com/2025/05/16/cispe_and_microsoft_abandon_dreams/
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