UK antitrust investigation could target Amazon and Microsoft over cloud services


Ofcom, Britain’s media and communications regulator, said it had “significant concerns” that Amazon and Microsoft could harm competition in the cloud services market.

In a statement on Wednesday, Ofcom said it is proposing to “refer” the cloud services market to the UK’s antitrust regulator, the competition and markets authority, for further investigation.

Ofcom’s investigation, which it launched in October, has so far uncovered “related practices by some of the world’s biggest technology companies,” said Fergal Farger, the Ofcom director who led the investigation.

“High boundaries to switching are already harming opposition in a swiftly developing market. We think there needs to be more in-depth scrutiny, to make sure it’s working well for the individuals and businesses that rely on these services,” Faragher added.

The Competition and Markets Authority said it had received Ofcom’s provisional results on Wednesday and was reviewing them. A spokesman said: “We are prepared to conduct a market investigation in this area, should Ofcom determine that it is necessary.

Ofcom’s announcement comes just days after Google Cloud accused Microsoft (MSFT) of anti-competitive cloud computing practices. In an interview with Reuters, Google Cloud Vice President Amit Jhaveri said the company has raised the problem with antitrust companies and entreated EU antitrust regulators to take a better look.

In an assertion shared with CNN on Wednesday, Zavery stated Ofcom’s report “highlights the want for certain gamers beneath the UK to do greater to create a stage gambling subject beneath the cloud market.

Cloud services are delivered over the Internet to businesses and consumers and include applications such as Gmail and Dropbox.
According to Ofcom, Amazon ( AMZN ) Web Services ( AWS ) and Microsoft’s Azure have a combined UK market share of 60% to 70% in cloud services.

Their closest competitor is Google (GOOGL), with 5% to 10% of Ofcom stating the 3 corporations charged high “egress fees” to switch statistics out of a cloud, discouraging customers from switching providers or using multiple providers to best serve their needs.

It also flagged technical restrictions imposed by leading providers that prevent some services from one provider from working effectively with other companies cloud services and said fee discounts were structured to encourage customers to use a single provider for all or most of their cloud needs.

There had been indicators that those marketplace capabilities had been already inflicting harm, “with proof of cloud clients going through sizeable rate will increase whilst they arrive to resume their contracts,” Ofcom said.

A Microsoft spokesperson stated the enterprise could preserve to interact with Ofcom on its investigation.“We stay dedicated to making sure the United Kingdom cloud enterprise remains incredibly competitive,” the spokesperson added.

An AWS spokesperson said: “These are intervening time findings, and AWS will preserve paintings with Ofcom beforehand of the book of its very last report.”

Ofcom has invited comments on its idea for additional research and could put up a very last choice by October five on whether or not to refer the cloud offerings marketplace to the Competition and Markets Authority.

“Making a marketplace research reference might be a massive step for Ofcom to take. Our thought displays the significance of cloud computing to UK clients and businesses,” it said.

Europe’s Digital Markets Act, which will apply in May, aims to enhance competition in online services.

Britain’s Digital Markets, Competition and Consumer Bill, additionally aimed toward boosting opposition in online services, is anticipated to return earlier than lawmakers this year.

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