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LATEST NEWS

  • Tech Journalist

Ofcom calls for UK cloud antitrust probe into Microsoft and Amazon amid competition concerns


UK regulators Ofcom and the Competition and Markets Authority (CMA) are investigating Amazon and Microsoft's dominance of the UK cloud market.



Ofcom did a study of the UK public cloud infrastructure market, and found “things” that make it hard for businesses to switch cloud providers or use multiple services. Ofcom is especially concerned about Amazon and Microsoft's large market share of 70-80%.


Ofcom will refer the market to the CMA for an independent investigation, and the CMA will decide if competition is harmed and if action should be taken.


In particular, Ofcom pointed to high "egress fees" to move data between providers as an issue. These discourage the use of multiple cloud providers or switching.


There are also technical barriers that make it hard to combine services from different providers. For example, large discounts for long-term commitments incentivize locking into one major provider, even when better options exist.


Industry experts have mixed reactions with some warning lengthy investigations could undermine innovation and flexibility in the cloud market. Others welcome it. They compare the move to past bank and energy switching difficulties that regulators helped fix.


AWS disagrees with Ofcom's findings but will work constructively with the CMA. However, they say intervention could unintentionally harm customers and competition.


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