Source URL: https://www.theregister.com/2025/01/28/microsoft_and_aws_cma_provisional_findings/
Source: The Register
Title: Cloud market working well… if you’re AWS and Microsoft
Feedly Summary: UK regulator files report on health of local sector, says technical barriers and Redmond’s licensing practices hurting smaller rivals + customers
The UK’s market regulator says “competition is not working as well as it could" in the local cloud services sector, and it plans to look harder at what AWS and Microsoft are doing – while giving Google a pass – in its Cloud Services Investigation.…
AI Summary and Description: Yes
**Summary:**
This text provides an overview of the UK’s Competition and Markets Authority (CMA) findings on the cloud services market, focusing on the dominance of AWS and Microsoft and the resulting anti-competitive practices. It highlights the significant market share held by these companies, the barriers to competition, and the proposed measures to enhance market competition. This is crucial for professionals in cloud computing security and compliance as it underscores the regulatory environment impacting market dynamics.
**Detailed Description:**
The UK’s Competition and Markets Authority (CMA) has conducted an investigation into the cloud services sector and found alarming levels of market concentration, primarily dominated by AWS and Microsoft. The implications of this dominance extend beyond market competition to issues of fairness and accessibility for other providers and their customers.
Key Findings from the CMA’s Investigation:
– **Market Dominance**: AWS and Microsoft collectively control a large share of the UK cloud services market (40-50% and 30-40%, respectively), leaving Google with a much smaller presence.
– **Barriers to Entry**: The investigation identified high entry costs and technical integration difficulties as significant barriers for rival cloud providers.
– **Lock-In Fees**: Egress fees, which charge customers for leaving a service, undermine customer mobility and incentivize continued use of AWS and Microsoft, limiting competition.
– **Software Dominance**: The CMA highlighted Microsoft’s software dominance (e.g., SQL Server, Windows, Visual Studio), allowing it to leverage this power against competitors such as AWS and Google.
Proposed Measures:
– **Strategic Market Status (SMS)**: The CMA suggests designating AWS and Microsoft with SMS, allowing for regulation aimed at promoting fair competition.
– **Further Scrutiny**: The CMA indicates plans for ongoing examination of the practices of these companies and potential remedies to address identified competition concerns.
Implications for Stakeholders:
– Businesses utilizing cloud services should be aware of the stability and costs associated with current providers and the potential for increased regulatory oversight.
– Regulatory changes could lead to improved market conditions, benefiting customers and potentially fostering innovation from alternative cloud service providers.
– Stakeholders, such as smaller cloud providers and customers, stand to benefit from a more competitive landscape if the CMA’s measures are effective.
Overall, the CMA’s findings signal a crucial moment for cloud service providers and consumers in the UK, emphasizing the need for vigilance against anti-competitive practices and supporting a fairer market environment.