UK seeks greater regulatory power over Microsoft and Amazon Web Services’ cloud computing services

[Pelican Press 0]

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*** seeks greater regulatory power over

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and

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Web Services’ cloud computing services

The ***’s Competition and Markets Authority (CMA) has announced its

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that the cloud services market “is not working as well as it could be.” That relatively vague statement follows a 16-month investigation into the

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, especially its two largest providers,

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Web Services (AWS) and

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. Both companies hold between a 30 and 40 percent market share, followed by

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at five to 10 percent.

Despite the vague thesis statement, the CMA’s investigation has so far raised a few critical points and recommendations. It found that there are alternative cloud suppliers face significant barriers to enter and expand in the market. Also, that “technical and commercial barriers” limit customers’ ability to switch providers, such as data transfer charges. Specific to

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, the CMA stated that the company uses its large software presence to limit how effectively AWS and

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can compete when it comes to customers who want to use that software while on the cloud.

The CMA reports that *** businesses and organizations have increased their spending on cloud services by 30 percent each year — hitting £9 billion ($11 million) in 2023. Given this £9 billion spend, the CMA stated that paying just five percent more than prices in a “well-functioning market,” would cumulatively cost another £430 million ($535 million) annually — more if the growth continues.

“Given the size of capital investment and economies of scale required to provide cloud infrastructure services, there may be a natural limit to the number of providers who can compete effectively in these markets,” the CMA’s states in its release. “For this reason, it is vital that competition between even a small number of providers works well for customers.”

The inquiry group points to a new solution: Strategic Market Status (SMS) designation for AWS and

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’s cloud services. The label comes courtesy of the ***’s new

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and would allow the CMA to enforce greater regulation and pro-competition directives on the two services. “Should AWS and

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be designated as having SMS, the CMA would be able to consider the interventions we have considered in this inquiry relating to egress fees, technical barriers and

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’s licensing practices,” the release further states.

Earlier this month, the CMA opened investigations into whether

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’s search practices and mobile ecosystems should receive SMS designation. The regulator is also probing Apple in the second instance.

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#seeks #greater #regulatory #power #

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#

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#Web #Services #cloud #computing #services

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