UK regulator calls for antitrust probe into Amazon and Microsoft’s cloud dominance

LONDON (Reuters) – Britain’s media regulator on Thursday asked the country’s antitrust authority to investigate U.S. tech giants Amazon. (AMZN.O) and Microsoft (MSFT.O) Dominance of the UK cloud market.

Ofcom said it had identified features that made it difficult for UK businesses to use multiple cloud providers.

Amazon Web Services (AWS) and Microsoft had a combined 70% to 80% share of Britain’s public cloud infrastructure services market in 2022, Ofcom said. Google (GOOGL.O) was its closest competitor with 5-10%.

“The CMA (Competition and Markets Authority) will now carry out an independent investigation to decide whether there is an adverse effect on competition and, if so, whether it should take action or recommend others take action,” he said.

Amazon said it disagreed with Ofcom, whose conclusions were based on “a fundamental misconception about how the IT sector works and the services and discounts on offer”.

“Any unwarranted intervention could cause unintended harm to IT customers and competitors,” a spokesperson said.

But he said he would work constructively with the CMA.

Microsoft said it was committed to ensuring the UK cloud industry remained innovative and highly competitive. “We will engage constructively with the CMA,” a Microsoft spokesperson said.

Ofcom said in April it was concerned about the practices of AWS and Microsoft because of their market positions, and planned to ask the competition regulator to investigate.

Reuters reported on Tuesday that Ofcom was I am expected to push for an antitrust investigation.

UK businesses told Ofcom they were concerned it would be too difficult to switch or combine cloud providers.

“We are therefore referring the market to the CMA for further scrutiny, to ensure that business customers continue to benefit from cloud services,” Ofcom director Fergal Farragher said.

The CMA welcomed the move and said many businesses were reliant on cloud services, making effective competition in the £7.5bn ($9.1bn) market essential.

Cloud computing has also attracted the attention of the French antitrust authority. In June he said several practices in the sector could potentially restrict competition, which could pave the way for future investigations.

EU antitrust regulators are also scrutinizing Microsoft’s cloud computing practices following a complaint from the Cloud Infrastructure Service Providers in Europe (CISPE) trade group, whose members include Amazon.

Google vice president Amit Zavery said the Ofcom reference demonstrated the need to create an open cloud market without vendor lock-in.

“UK government agencies, businesses and consumers want to move easily across cloud platforms and choose which services best meet their needs,” he said, adding that Google will continue to allow its products to run on any cloud without penalty. .

The CMA will complete its investigation in April 2025.

($1 = 0.8232 pounds)

Our code of conduct:Thomson Reuters “Principles of Trust”