Protocol | Policy

Google and Microsoft are at it again, now over government software

The on-again, off-again battle between the two companies flared up again when Google commissioned a study on how much the U.S. government relies on Microsoft software.

Pair of boxing gloves

Google and Microsoft are in a long-running feud that has once again flared up in recent months.

Photo: Jens Tandler/EyeEm/Getty Images

According to a new report commissioned by Google, Microsoft has an overwhelming "share in the U.S. government office productivity software market," potentially leading to security risks for local, state and federal governments.

The five-page document, released Tuesday by a trade group that counts Google as a member, represents the latest escalation between the two companies in a long-running feud that has once again flared up in recent months.

The report found what its authors call a "monoculture," alleging that Microsoft controls about 85% of the market of tools for communicating and collaborating, with Google as the next most popular vendor. The study ascribes Microsoft's position to governments' preference for sticking with vendors they already use, rather than trying potentially better options.

The Google-commissioned report also claims that governments' emphasis on ease "creates potential concentration risk and security vulnerabilities."

Microsoft's position "creates a bullseye on the government for bad actors, thereby putting the government at a greater risk for a national security incident," said Matthew Schruers, president of the Computer & Communications Industry Association, the trade group that released the findings and joined in commissioning them.

CCIA is one of Microsoft's oldest antagonists. It was deeply critical of the 2001 antitrust settlement between the U.S. and Microsoft, and filed a complaint to the European Commission about Windows XP. In 2004, the group's then-president reportedly personally received nearly $10 million from an agreement between the company and the association to pull back from the clashes.

The report is reminiscent of the 1998 U.S. antitrust lawsuit against Microsoft, when the Justice Department found Microsoft's bundling of Internet Explorer and the Windows operating system to be anticompetitive. The research also echoes recent government procurement battles.

The report authors, for instance, hint Microsoft possesses "dominant market shares" and say the company bundles Office 365 and Microsoft Teams in large deals to take advantage of government inertia in procurement. That concern also echoes the corporate clashes over the Pentagon's defunct "JEDI" contract for cloud computing, which Microsoft won before the bid was canceled.

The Defense Department contract, which Google also briefly sought to win, demonstrated just how furiously companies are willing to compete for lucrative government clients who may not have the same flexibility as private-sector buyers to switch vendors or try new products. Microsoft and other companies, including Amazon, vying for government contracts often cite security as their main value proposition to the government.

Tensions between Google and Microsoft significantly predate JEDI and go all the way back to the Microsoft lawsuit, which the U.S. settled in 2001. People who worked at both companies say the suit allowed Google, which was founded the same year the suit began, to grow without being acquired or squashed by Microsoft.

The rivals sparred through much of the aughts and early 2010s, especially over internet search. The tactics included Microsoft's "Scroogled" campaign hitting Google over its privacy policies. Google, in turn, published evidence Bing was scraping Google search results.

The battles calmed significantly by 2016, although they never quite went away, before picking up again this year. Microsoft President Brad Smith in February endorsed an Australian measure, which Google fought, to give media properties more bargaining power against platforms. Smith then testified before the U.S. Congress that Google used journalistic content to keep users engaged while denying them meaningful opportunity to monetize those visits.

"When a company's success creates side effects that adversely impact a market and our society, the problem should not be ignored," Smith wrote in prepared testimony.

Google hit back, saying in a blog post that Microsoft's claims were incorrect and its motivation was "self-serving," especially as an attempt to distract the public following hacks of governments and businesses that used Microsoft's email services.

"They are reverting to their familiar playbook of attacking rivals and lobbying for regulations that benefit their own interests," wrote Google's vice president of global affairs, Kent Walker.

Microsoft, which is valued at more than $2 trillion, certainly has an immense impact on the market for business software, and it has gone largely unexamined in recent antitrust discussions as government enforcers focus instead on cases against Google and other tech giants. The U.S. suit against Google zeroes in on the company's purported actions to maintain the monopoly of its search engine, which competes with Microsoft's Bing.

Microsoft and Google have also recently clashed over the former's production of documents to Google in the suit. In its filings, Microsoft acknowledged it had more or less cooperated with the U.S. and state investigations into Google last year.

Theranos trial reveals DeVos family invested $100 million

The family committed "on the spot" to double its investment, an investment adviser said. Meanwhile, the jury lost another two members, with two alternates left.

Betsy DeVos' family invested $100 million in Theranos, an investment adviser said.

Photo: Alex Wong/Getty Images

Lisa Peterson, a wealth manager for the DeVos family, testified in Elizabeth Holmes's criminal fraud trial Tuesday, as prosecutors continued to highlight allegations about how the Theranos CEO courted investors in the once-high-flying blood-testing startup.

An email presented by the defense revealed that the family committed to doubling their investment in Theranos to $100 million "on the spot" during a 2014 visit to company headquarters.

Keep Reading Show less
Michelle Ma
Michelle Ma (@himichellema) is a reporter at Protocol, where she writes about management, leadership and workplace issues in tech. Previously, she was a news editor of live journalism and special coverage for The Wall Street Journal. Prior to that, she worked as a staff writer at Wirecutter. She can be reached at

If you've ever tried to pick up a new fitness routine like running, chances are you may have fallen into the "motivation vs. habit" trap once or twice. You go for a run when the sun is shining, only to quickly fall off the wagon when the weather turns sour.

Similarly, for many businesses, 2020 acted as the storm cloud that disrupted their plans for innovation. With leaders busy grappling with the pandemic, innovation frequently got pushed to the backburner. In fact, according to McKinsey, the majority of organizations shifted their focus mainly to maintaining business continuity throughout the pandemic.

Keep Reading Show less
Gaurav Kataria
Group Product Manager, Trello at Atlassian
Protocol | Enterprise

Google Cloud helped design Intel’s newest data center chip

Mount Evans is Intel's first IPU data center chip, and Google Cloud, which played a role in its development, will be the first customer.

Intel CEO Pat Gelsinger has a new data center chip.

Photo: Pau Barrena/Bloomberg

When Intel announced that it had turned to technology developed by longtime rival Arm for a new infrastructure processing unit called Mount Evans, it said the technology was co-developed by a cloud-service provider that it wouldn't name: until now.

Google Cloud is that design partner, and it has committed to deploying the technology inside its cloud data centers, Intel plans to announce Wednesday at its Innovation event.

Keep Reading Show less
Max A. Cherney

Max A. Cherney is a Technology Reporter at Protocol covering the semiconductor industry. He has worked for Barron's magazine as a Technology Reporter, and its sister site MarketWatch. He is based in San Francisco.

Protocol | Workplace

Lessons from Facebook’s civil rights audit, a year later

Before the Facebook Papers, Facebook's audit made the case for transparency.

A new report released Wednesday lays out how companies can successfully conduct their own civil rights audit.

Photo: Kirill Kudryavtsev/AFP via Getty Images

Before Frances Haugen, before the Facebook Papers, before The Wall Street Journal's Facebook Files, Facebook had a chance to correct some of its algorithmic bias issues through an internal "civil rights audit" that concluded last year. According to people who contributed to the audit at the time, the company's response fell short.

That audit was conducted by Laura W. Murphy, a former director at the ACLU who has experience running similar audits for companies like Airbnb and Starbucks.

Keep Reading Show less
Michelle Ma
Michelle Ma (@himichellema) is a reporter at Protocol, where she writes about management, leadership and workplace issues in tech. Previously, she was a news editor of live journalism and special coverage for The Wall Street Journal. Prior to that, she worked as a staff writer at Wirecutter. She can be reached at

The case for flying cars — and why they’re coming sooner than you think

Kitty Hawk's Sebastian Thrun on why he believes in the avian future of transportation. And why he'd prefer you not call them "flying cars."

Kitty Hawk's Heaviside might be flying over your house sometime in the next few years.

Photo: Kitty Hawk

Sebastian Thrun was one of the early pioneers of the self-driving car, and spent years working at Google and elsewhere to make autonomous vehicles a reality. Then he ditched the industry entirely and went for something even bigger: flying cars.

Except, wait, don't call them flying cars. Thrun, now the CEO of Kitty Hawk, calls them "electric vertical take-off and landing aircrafts," or eVTOLs for short. (It's not quite as catchy.) But whatever the name, Thrun is betting that they'll be transformative. No more dealing with existing infrastructure and outdated systems, no more worrying about the human driver next to you. He imagines a fully autonomous, fully safe, much more environmentally-friendly skyway system that doesn't have to worry about terrestrial matters at all. And he's convinced that's all coming much faster than you might think.

Keep Reading Show less
David Pierce

David Pierce ( @pierce) is Protocol's editorial director. Prior to joining Protocol, he was a columnist at The Wall Street Journal, a senior writer with Wired, and deputy editor at The Verge. He owns all the phones.

Latest Stories