October 4, 2023
At a Glance
- Britain regulators will look to push antitrust probe into AWS and Microsoft cloud offerings.
- Big Tech firms say consumers would be hurt by an investigation.
- Investigation marks another attempt by UK and EU to curb Big Tech power.
Britain’s media regulator, Ofcom, will push this week for an antitrust probe into Amazon and Microsoft’s UK cloud computing dominance, anonymous sources told Reuters on Wednesday.
Ofcom had previously lobbied for a UK cloud market investigation based on its market study that claimed the companies’ practices made it more difficult for customers to switch and use multiple suppliers. Ofcom will make its official push for an investigation by the UK’s Competition and Markets Authority, according to Reuters.
“We’ve done a deep dive into the digital backbone of our economy, and uncovered some concerning practices, including by some of the biggest tech firms in the world,” Fergal Farragher, Ofcom’s director responsible for the market study, said in a prepared statement along with the original report in April. “High barriers to switching are already harming competition in what is a fast-growing market. We think more in-depth scrutiny is needed, to make sure it’s working well for people and businesses who rely on those services.”
Microsoft and Amazon Web Services (AWS) enjoy an estimated 60-70% of the UK cloud market. The final report on the matter and referral for investigation is set to be released Thursday, according to the April release.
Microsoft had released a 58-page response to Ofcom’s earlier proposal, claiming such an investigation would ultimately harm consumers. “It would be a particularly unfortunate outcome if UK businesses and public sector customers faced less vibrant and competitive cloud solutions on a global stage than those available to their rival in the EU, the U.S. and China,” the company said.
AWS released its own 14-page rebuttal of Ofcom’s April report. “…there are tens of thousands of other IT companies, including Accenture, BMC, Capgemini, and Deloitte, that partner with AWS to offer migration and other services directly to AWS customers. These partners often maintain relationships with other providers and facilitate customers switching away from AWS.”
European officials have been cracking down on what they see as antitrust activity by various global tech companies. Earlier this week, it was widely reported that French law enforcement agencies raided Nvidia’s offices following months of investigations. A French report in June outlined antitrust concerns and mentioned key cloud players including AWS, Microsoft Azure, and Google Cloud. Those cloud services are highly dependent on Nvidia’s GPU offerings.
InformationWeek has reached out to Amazon and Microsoft for comment and will update this story.
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