HomeWinBuzzer NewsUK Regulators to Investigate Microsoft and Amazon Cloud Services

UK Regulators to Investigate Microsoft and Amazon Cloud Services

The Ofcom cloud services investigation highlighted issues such as high data migration costs, incentives to use a single cloud provider, and technical challenges in switching providers.

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The 's Competition and Markets Authority (CMA) and telecom regulator Ofcom have announced a new investigation into the practices of major cloud service providers, and Amazon. Following concerns relating to cloud gaming around Microsoft's on-going Activision Blizzard acquisition, the regulators have turned their focus onto Microsoft Azure cloud and Amazon Web Services (AWS). Their investigation is part of an overall scrutiny of public cloud providers in the UK.

Issues stemming from the research conducted by Ofcom have raised concerns around the difficulty faced by customers when switching to and using multiple cloud suppliers. Some of these issues include significant charges linked to migrating data out of cloud facilities, incentives to use a single cloud provider, and technical obstructions appearing in switching between cloud providers. Additionally, Ofcom shared their concerns about the software licensing practices of cloud providers, highlighting Microsoft in particular.

Ofcom initially opened its investigation last September, also looking at . It seems following its year-long probe, the watchdog sees and Microsoft as risks and has not decided to move forward with any regulatory investigation against cloud. 

Dominating the Public Cloud Infrastructure

Both Microsoft and Amazon are reported to control around 70-80 percent of the public in the UK, thus leading to medium-high concentration of the market among these two players. Ofcom's market study identified notable concern around the practices of Amazon's AWS and Microsoft due to their dominant market position.

The investigation will focus on determining whether competition in the market is effective and if not, what measures should be taken to resolve any identified issues. Sarah Cardell, CEO of the CMA, stated that the authority's independent inquiry group will carry out an in-depth investigation to dig deeper into the matter.

Concerns across Europe

The UK regulators are not the only ones raising concerns over the competition in the . The Cloud Infrastructure Services Providers in Europe (CISPE), a trade group that includes Amazon among its members, lodged an antitrust complaint with the European Union last year. They argue that Microsoft has taken unfair advantage of their dominance in productivity software to direct European clientele to their Azure cloud infrastructure, to the detriment of European cloud infrastructure providers and users of IT services.

Microsoft had offered licensing concessions over a year ago, though these have done little to assuage the complaints. Google earlier this year publicly criticized Microsoft's cloud software licensing “tax,” claiming that enterprises have to pay an additional charge to run software like Office on other cloud networks.

The CMA's market investigation is expected to last 18 months and is scheduled for completion by April 4, 2025. The findings will detail theories of harm as well as any potential remedies that might address the situation. The UK regulator also has the power to impose structural remedies, which could compel companies to sell facets of their business as a means to uplift competition.

Sourcegov.uk
Luke Jones
Luke Jones
Luke has been writing about all things tech for more than five years. He is following Microsoft closely to bring you the latest news about Windows, Office, Azure, Skype, HoloLens and all the rest of their products.

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