The Bureau of Competition and the UK markets has published the Provisional Finding of the investigation of all cloud service providers in the country according to fear of the telecommunications regulator ofCom.
The current conclusion is that the cloud service market “does not work as well as” because it is difficult for customers to switch cloud providers or use more clouds. The lack of competition probably leads to higher costs, smaller selection, smaller innovation and lower quality of services.
“The ability of British enterprises to put healthy pressure on cloud providers is to offer better offers is the key to establishing good results and unlocking the potential benefits of cloud services,” CMA said in a press release.
4 network concerns about the British cloud service market
The independent CMA investigation group found four primary concerns in its investigation:
- Cloud customers face a limited selection of providers and are not aware that more providers can offer the same services.
- Technical and commercial barriers make it difficult to switch cloud providers or use more clouds, leading to blocking.
- For new providers, it is difficult to enter the market and compartment due to a very large capital investment necessary to provide cloud services.
- Microsoft makes it difficult for rivals such as Google and Amazon web services to use customers who want to use Microsoft software in the cloud.
Microsoft and AWS share up to 40% of the UK customers for cloud services, which is considerably dominated by the market; The third large provider, Google, has a much smaller share. Although the dominant players take up only 5%, according to CMA, it could cost 430 million GBP a year in the UK.
The investigation came on the heels of the 2023 report published by ofCom, in which the regulator identified a number of questions that suffer from the cloud service market that represents the consequences for companies and consumers. CMA dealt with fees for outputs, technical barriers and dedicated discounts on the recommendation of ofCom, but in prudently found that only the competition of Form Two Harst Competition.
The decision on how to make these interim findings and final recommendations will be made by August. 4, 2025.
AWS and Microsoft could be subject to new digital markets, competitive and consumers of the law
The investigation group recommended that CMA consider the provision of AWS and Microsoft “Strategic Market Market” based on new digital markets, competition and consumers that came into force in January. 1, 2025. The law was specially designed to regulate the behavior of the main digital companies with a significant market force in the UK
CMA conducts an investigation by IT Express to have strategic market status. If companies are provided with this designation, the regulators will propose contract requirements to follow them and prevent anti -competitive procedures. The interviewing group said that AWS and Microsoft regulation within DMCCA will allow it to attract “targeted and flexible access to remedies” and “better provisions for continuous monitoring and supervision.
Requirements for the implementation of dominant cloud service providers could support technical standardization, reduce data for data transfer when switching switching providers or multiples, and provide fair licenses of software.
Investigations whether Google and Apple should receive SMS are taking place. Both companies look at their mobile ecosystems. Google is also investigated in advertising services for search and search.
See: Dominance of Apple’s mobile browser Apple Sundy UK regulator
Reaction of industry to CMA investigation
Daniel Tremayne-Pitter, CEO of the British Technology Research Society, emphasized the need to democratize the cloud computing market, Reaings on CMA to investigate the Cloud Service market in the UK.
He said, “Even without identifying anti-competing practices, I believe there is a significant need to democratize the cloud computing landscape. Namely due to resistance. Academics, sustainability experts, cloud architects, and now, even regulatory bodies around the world, recognize that the strength and news of which has a small number of providers concerns.
Microsoft and Amazon respond to the survey ofCom
Amazon and Microsoft have published lengthy answers in response to the Cloud market survey. Here are short excerpts from these answers.
Amazon offered to have counterRESALA. “We do not agree with concerns raised in the interim report that the expenditure discounts” may dampen the competition by motivating customers to use one provider for most of their needs, or need customers to increase their love to spend their agreements on their agreements , ”The company said. “AWS prices are publicly listed on our website and every customer can use our services at these prices, as well as little ASY needs.”
Microsoft’s answer was: “Azure does not use” locked “customers at the price, while the competet for new, not least because this dichotomy is false. There is also no realistic possibility that Microsoft or any cloud seller can slow down their fast pace of innovation due to locking effects. ”
However, Tremayne-Pitter had a different opinion and claimed that “almost every technologist describes” lock “as a very real risk factor.
He commented: “The costs of the output cost of moving the cloud data are usually disproportionate to the” free “nature of putting them there first. With a serious volume, this could cause it to be costly prohibitive, even consider its transfer. The ambitious and innovative organization is easily consumed by the proprietary tools of cloud providers; However, if your application or business workload is delivered through this owner’s tool, you will not move anywhere if you cannot save time and the cost of reworking your application in another environment.
CMA Survey may have an impact on deep consequences
The British Cloud Service has seen huge growth over the past few years, and by 2029 it is planned to achieve $ 82.87 billion. Consequences for various stakeholders, including business owners, cloud service providers and Broade UK.
If CMA investigation results in regulatory changes that support fair competition, businesses can make a more informed decision on their cloud service providers, thereby reducing the risk of unlocked costs or locking the supplier. The cloud service market could also lead to a wider range of possibilities and to encourage the provider to offer custom -made services that will satisfy different business needs.
While the outcome of the investigation can force the cloud provider to adjust their price models, license agreements and data migration processes, and also create opportunities for new market entry players, there are a number of concerns. One of them is that cloud service providers can support increased costs for compliance with compliance with new regulations and adapt their business models. These additional exhausts could be potentially handed over to customers.
Likewise, regulatory changes and increased competition of the cloud service market may require owners of businesses to migrate data, applications and processes to various cloud providers or to adapt to new prices. These costs may affect budgets and resources.
Another problem is that the measures of fair competition supported by the government can compress profit margins for the established cloud providers. They are responsible for responsibility, and perhaps these cloud providers may have to consider measures or costs in their price strategies and resort to the logerization of the quality of their services and create a balance between business costs and profits.
Depending on the investigation, the British business environment can experience more economic growth or be pierced as hostile. If CMA comes up with measures that will ensure more competitive prices and flexible models of life, it could reduce IT expenditures for companies as well as energy energy to speed up their efforts for digital transformation.
However, rapid changes in regulations and coercive measures could create uncertainty for companies operating in the UK, which would affect their long -term planning and investment decisions. The British Reputation of the Technology and Innovative Center could also be questioned, which would affect its attraction to technology companies and investors.
Franklin OKKEK contributed to this article.