Microsoft Azure ends egress fees amid pressure over 'unfair licensing practices'

Microsoft Azure finally caved to the mounting pressure to remove data egress fees.

The hyperscaler announced this week it would no longer charge customers data transfer fees when switching to a different cloud provider. This comes after both Google Cloud and Amazon Web Services (AWS) waived egress fees earlier this year.

But the move isn't quite enough in Amit Zavery's opinion. Zavery, GM and VP for Google Cloud, tweeted that Microsoft still has work to do: "@Microsoft's decision to stop charging its customers exit fees is a step in the right direction. But to really support customer choice, it’s time to address the greatest barrier: MSFT's restrictive and predatory licensing that force customers into Azure."

When Google announced the end of egress fees in January, Zavery alluded to Microsoft having "restrictive and unfair licensing practices."

"Certain legacy providers leverage their on-premises software monopolies to create cloud monopolies, using restrictive licensing practices that lock in customers and warp competition," he explained in a blog post.

Microsoft Azure's move to waive egress fees also only applies to exiting customers that plan on canceling all Azure subscriptions, reported TechCrunch.

"A business wishing to adopt a multi- or hybrid-cloud approach that includes Azure, will still have to pay egress fees once they've used up their 100GB monthly allowance," explained TechCrunch's Paul Sawers. The waiving of data transfer fees also only applies to storage data, he added.

Related:AWS follows Google Cloud in ending cloud switching costs

Getting ahead of regulation

In November 2023, Google called out Microsoft by approaching the CMA (Competition and Markets Authority), the UK's antitrust regulator. Google claimed Microsoft's "business practices had left rivals at a significant disadvantage," according to Reuters. The CMA launched an investigation into the UK's cloud providers last October after telecom industry regulator Ofcom reported on Azure's and AWS's domination of the cloud industry.

"In 2022, Amazon Web Services (AWS) and Microsoft's Azure had a combined 70-80% share of Britain's public cloud infrastructure services market, Ofcom said. Google’s cloud division was their closest competitor, at around 5-10%," reported Reuters.

All three major cloud providers are also likely removing data transfer fees in preparation to meet requirements under the European Data Act. The European Commission said that under the new legislation customers will be able to switch between cloud providers free of charge. The Data Act goes into effect on September 12, 2025.