UK regulator asks for antitrust inquiry into Amazon, Microsoft cloud dominance

British media regulator Ofcom on Thursday asked the country’s antitrust regulator to investigate US tech giants Amazon and Microsoft’s dominance of the UK cloud market.

Ofcom said its study identified features that make it more difficult for UK businesses to switch to, and use multiple cloud suppliers.

"The CMA (Competition and Markets Authority) will now conduct an independent investigation to decide whether there is an adverse effect on competition, and if so, whether it should take action or recommend others to take action," Ofcom said in a statement.

Reuters on Tuesday reported that Ofcom was expected to push for an antitrust investigation into Amazon's and Microsoft's dominance of the UK cloud computing market, according to two sources familiar with the matter.

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Ofcom, which started looking into cloud services last year, had said in April it was particularly worried about the practices of Amazon Web Services (AWS) and Microsoft because of their market positions, and planned to ask the competition regulator to investigate.

UK businesses have told Ofcom they were concerned about it being too difficult to switch or mix and match cloud provider, Fergal Farragher, Ofcom's Director responsible for the Market Study.

“So, we’re referring the market to the CMA for further scrutiny, to make sure business customers continue to benefit from cloud services,” Mr Farragher added.

The communications regulator said its study found that Amazon Web Services (AWS) and Microsoft had a combined market share of supply by revenue in UK public cloud infrastructure services market of 70 per cent to 80 per cent in 2022.

Google was their closest competitor with a share of 5-10 per cent, Ofcom added.

(c) Copyright Thomson Reuters 2023