European Cloud Providers Secure Major Victory in Licensing Battle Against Microsoft

European Cloud Services Achieve Critical Win in Microsoft Licensing Dispute

In a significant development for the European cloud computing sector, the Cloud Infrastructure Services Providers in Europe (CISPE) have secured a pivotal agreement with Microsoft. This milestone allows CISPE members to offer Microsoft software on a pay-as-you-go basis through the Microsoft CSP-Hoster Program. Importantly, the new licensing model ensures pricing that is far more competitive and closely aligned with those on Microsoft’s own Azure cloud platform, leveling the playing field for European providers.

Enhanced Privacy and Customer Sovereignty for European Enterprises

This triumph comes after a prolonged struggle between CISPE and Microsoft over fair access to cloud services and data protection. A key breakthrough in the agreement permits CISPE members to host customer workloads without having to relay customer data back to Microsoft, representing a major win for data privacy advocates and adhering to strict European data sovereignty principles.

Product Features and Ongoing Limitations

One of the landmark features resulting from this agreement is the forthcoming Microsoft 365 Local service, which will enable organizations to deploy Microsoft 365 on local, sovereign European cloud infrastructure. This development removes the financial and logistical barriers previously imposed on customers wishing to use Microsoft applications on non-Microsoft clouds. However, challenges remain—particularly the mandatory use of Microsoft's own Entra ID for identity and access management within Microsoft 365, with no alternative solutions supported at this time.

Industry Impact and Customer Advantages

Francisco Mingorance, CISPE Secretary General, described the agreement as a significant breakthrough that helps ensure fair competition across the cloud market. "For enterprise customers, these new licensing programs directly address long-standing issues around sovereignty, compliance, and cost, empowering organizations to select cloud solutions best suited to their business needs," Mingorance stated.

Market Relevance and the Road Ahead

Despite achieving major progress, ongoing negotiations continue, as Microsoft reportedly prepares a counterproposal following missed deadlines in prior settlement attempts. The CISPE-Microsoft agreement is set to have lasting effects on cloud computing competition, enterprise IT infrastructure, and regulatory compliance across Europe, raising the bar for transparency, flexibility, and user data protection within the industry.