Microsoft : Google Fires Back at Microsoft as Long-Simmering Feud Intensifies

By Tripp Mickle and Aaron Tilley

A long-simmering feud between tech giants Google and Microsoft Corp. reignited on Friday, in the latest fracture among the country's tech giants as they face increased regulatory pressure and scrutiny around the world.

The unusual public squabbling, which included Google's top lawyer saying that Microsoft is criticizing the search giant to distract from its own role in two recent high-profile hacks, came against the backdrop of a Washington, D.C., congressional hearing about the impact of online platforms on the news industry. It is one of several high-profile disputes this year around Silicon Valley, including Facebook Inc. and Apple Inc. sparring over privacy-related issues.

Microsoft President Brad Smith discussed Google at length in his prepared remarks at Friday's hearing, saying that online news is the food that feeds Google's massive search and advertising network, and suggesting ways the search giant could better support the news industry. He expressed his support for legislation that would give news organizations more bargaining power with Facebook and Google.

Other supporters of the bill include the News Media Alliance, an industry trade group that includes News Corp, publisher of The Wall Street Journal.

Just ahead of the hearing, Google's senior vice president of global affairs, Kent Walker, fired back in a blog post. He defended Google's support of journalism, asserting that it has paid publishers for links to their work and accused Microsoft of "naked corporate opportunism."

"They are reverting to their familiar playbook of attacking rivals and lobbying for regulations that benefit their own interests," Mr. Walker wrote. "They are now making self-serving claims and are even willing to break the way the open web works in an effort to undercut a rival."

Mr. Walker said it was "no coincidence" that Microsoft's attacks on Google came amid continuing scrutiny of the software giant's role in two recent hacks.

Microsoft offers a news app and website that it says include content from more than 1,200 publishers. Google, a unit of Alphabet Inc., said in October that it was committing $1 billion to a new product called Google News Showcase that will support publishers around the world.

Mr. Walker characterized Microsoft's history of supporting news as "spotty" and said that the rival has paid out less to publishers than Google.

Microsoft declined to comment on Google's statement. Google declined further comment.

The dispute was spawned by a globe-spanning debate over new regulations that would require platforms to pay publishers for linking to their news sites. Last month, Australia introduced legislation that would compel such payments, triggering multiyear licensing deals between Google and Facebook with content providers such as News Corp.

The pressure from Microsoft comes as Google defends itself against the Justice Department's antitrust lawsuit, filed last fall, alleging it has unlawfully maintained its dominant position as the web's preeminent search engine by striking business agreements to shut out competitors. A trial isn't expected until late 2023, but the regulatory pressure has inflamed tensions between tech companies facing new scrutiny in Washington.

Microsoft and Google have battled over who would be the internet's gatekeeper since the early 2000s, when Internet Explorer began to give way to what was then a search-engine startup. As Microsoft fended off an antitrust inquiry, Google surged in prominence and became the web's leading browser, e-mail provider and mobile-phone service. Tensions between the tech companies heightened as their competition expanded to new businesses.

Microsoft and Google are both competitors and partners in a number of business lines. Microsoft's Bing search engine competes with Google's more widely used service. Google's efforts to build up its cloud computing division bring the company into more direct competition with Microsoft. But the Redmond, Wash.-based software company also relies on Google's Android software on some of its Surface gadgets.

Microsoft has a long history of lobbying against Google. Under Chief Executive Steve Ballmer, Microsoft kicked off an anti-Google attack advertising campaign called "Scroogled" that ran between 2012 and 2014.

When Satya Nadella took over in 2014, he sought a more peaceful relationship and ended the attacks. The executive responsible for the advertising campaign, Mark Penn, departed in 2015. In 2016, Microsoft and Google brokered a truce and withdrew their regulatory complaints against each other globally.

Microsoft generated around $7.7 billion in search advertising revenue in its latest financial year. Google last year had around $104 billion in search-related sales.

Write to Tripp Mickle at [e-mail] and Aaron Tilley at [e-mail]

(END) Dow Jones Newswires

03-12-21 1450ET