UK regulator may investigate AWS and Microsoft cloud businesses

If the various points made in the inquiry are dissected, said Maisto, “we can argue that: a) it is not actually true that cloud customers face a limited choice of providers as there are plenty of cloud vendors; b) it is unlikely that the US hyperscalers may not reflect the evolving business needs of UK clients; c) the significant barriers to entry and expansion in this market are not the hyperscalers’ fault but rather a matter of fact.”

He added that, while according to the inquiry, Microsoft is using its strong position in software to make it harder for AWS and Google to compete effectively for cloud customers, it “actually reached agreement with CISPE back in July 2024 related to CISPE’s competition complaint filed against Microsoft with the European Commission in November 2022.”

According to Maisto, “the inquiry group does have a point that the ability of UK businesses to put healthy pressure on cloud providers to offer better deals is key to ensuring good outcomes and to unlocking the potential benefits of cloud services, but does not consider that UK businesses can and should address these concerns from a concentration risk perspective.”

UK organizations, he said, are “still free to leverage multiple cloud vendors and/or cloud providers that are not hyperscalers. In our Forrester European Public Cloud Platform Wave, 2024, for example, we do provide a piece of evaluative research featuring at least seven alternative cloud vendors with the full spectrum of services available in the hyperscaling cloud market as well. All in all, the inquiry does address a right concern but fails to acknowledge the actual problems behind such a setup of the market.”   

The inquiry group next plans to “consult on its provisional findings and recommendations,” before making a final decision by August 4.

From there, it will be up to the CMA board to decide if and when to open SMS designation investigations, and, in an interesting twist, its chair is Doug Gurr, former country manager of Amazon UK.