The Office of Communications (Ofcom), the UK’s communications regulator is putting the world’s largest tech companies under the microscope. An investigation will look into the practices of Big Tech names such as Microsoft, Amazon, and Google in regard to cloud services.
Specifically, the group will investigate the dominance of these three companies to ensure competition is fair. Furthermore, the regulator will look into WhatsApp, FaceTime and Zoom in the video messaging market, and the Amazon Echo, Google Nest, and Apple HomePods in the digital personal assistant market.
However, it is the cloud investigation that is the biggest. Amazon Web Services (AWS), Microsoft Azure, and Google Cloud are comfortably the biggest players in the cloud industry. AWS is comfortable ahead of Azure, while Microsoft’s product is comfortably ahead of Google.
Even so, all three are thriving and the question is, what about the rest? How is the dominance of these three heavyweights impacting other cloud providers?
Ofcom points out that Amazon, Microsoft, and Google account for four-fifths (80%) of the UK cloud computing market. Of the three, AWS is the leader with over half of that. The regulator will spend the next year investigating this dominance and how it impacts smaller players in the market.
Selina Chadha, Ofcom’s director of connectivity, says: “The way we live, work, play and do business has been transformed by digital services.
“But as the number of platforms, devices and networks that serve up content continues to grow, so do the technological and economic issues confronting regulators.
“That’s why we’re kickstarting a programme of work to scrutinise these digital markets, identify any competition concerns, and make sure they’re working well for people and businesses who rely on them.”
Ofcom will study the strength of competition against what the regulator called the “hyperscalers” in the market. Furthermore, the investigation will look into what limitations on the market (if any) are stifling innovation and growth.
“How well digital markets function will be increasingly important to the outcomes consumers experience across the sectors we regulate. We need to be looking as much at how companies are using digital infrastructure and services as we do the cables, masts and satellites that we have focused on in the past.”
Ofcom is operating under the Enterprise Act 2002, a UK law that allows it to conduct market studies in digital communication industries.
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