BRUSSELS, July 10 (Reuters) - Microsoft ( MSFT ) has

clinched a 20-million-euro ($21.7 million) deal to settle an

antitrust complaint about its cloud computing licensing

practices, averting an EU antitrust investigation and potential

hefty fine.

Cloud services organisation CISPE, whose members include

Amazon ( AMZN ) and a score of small EU cloud providers,

complained to the European Commission in late 2022 alleging that

contractual terms imposed by Microsoft ( MSFT ) on Oct. 1 were harming

Europe's cloud computing ecosystem.

Microsoft ( MSFT ) ranks behind market leader Amazon ( AMZN ) in the

multibillion-dollar cloud computing sector but ahead of

Alphabet's Google. The industry has drawn antitrust

scrutiny on both sides of the Atlantic.

"After working with CISPE and its European members for more

than a year, I am pleased that we've not only resolved their

concerns of the past, but also worked together to define a path

forward that brings even more competition to the cloud computing

market in Europe and beyond," Microsoft ( MSFT ) President Brad Smith

said.

Microsoft ( MSFT ) will develop a product allowing CISPE's members to

run Microsoft ( MSFT ) software on their platforms on the U.S. tech

giant's Azure cloud infrastructure with prices equivalent to

Microsoft's ( MSFT ) prices, CISPE said. It has nine months to deliver.

Microsoft ( MSFT ) will also compensate CISPE members for lost

revenues related to their licensing costs over the last two

years, the group said. It did not disclose financial figures.

Microsoft ( MSFT ) has offered about 20 million euros in total, two

people with direct knowledge of the matter told Reuters.

The settlement does not include Amazon Web Services (AWS),

Google Cloud Platform and AliCloud, prompting criticism from the

first two companies.

"We continue to stand with the growing number of customers,

providers, and regulators globally who are calling on Microsoft ( MSFT )

to end its discriminatory practices for all customers," an AWS

spokesperson said.

The head of Google Cloud said he hoped regulators elsewhere

would continue to look into Microsoft's ( MSFT ) licensing practices

"Many regulatory bodies have opened inquiries into

Microsoft's ( MSFT ) licensing practices, and we are hopeful there will

be remedies to protect the cloud market from Microsoft's ( MSFT )

anti-competitive behavior," Amit Zavery said.

"We are exploring our options to continue to fight against

Microsoft's ( MSFT ) anti-competitive licensing in order to promote

choice, innovation, and the growth of the digital economy in

Europe."

CISPE said it would now withdraw its EU complaint and would

not start or support complaints on these issues in Europe and

elsewhere.

"This agreement will provide a level playing field for

European cloud infrastructure service providers and their

customers," CISPE Secretary General Francisco Mingorance said.

($1 = 0.9240 euros)