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Amazon and Microsoft dominate the global cloud-computing market, with Google a smaller player.
Dreamstime
First
Alphabet’s
Google and
Amazon
came under scrutiny from antitrust regulators. Now
Microsoft
is also one of the subjects of an investigation.
Microsoft
(ticker: MSFT) and
Amazon’s
(AMZN) dominance of the cloud-computing market is set to be probed in the U.K. British regulators have called for an investigation into the market, citing the companies’ combined market share of an estimated 70%-80% in cloud-infrastructure services and potential limits on competition.
The U.K.’s Competition and Markets Authority, or CMA, has form. Microsoft already had one extended run-in with U.K. antitrust authorities this year as the CMA took a tough stance over its proposed acquisition of
Activision Blizzard
(ATVI), which was resolved by the transfer of cloud-streaming rights for Activision’s games to a rival company.
The very same regulator will now investigate cloud computing. While in Britain the market is relatively small –it was worth around $9.1 billion in 2022 according to the CMA– any changes that the regulators demand could set a precedent for other markets.
The U.S. Federal Trade Commission said earlier this year that it was seeking information on the business practices of the cloud-computing companies, where Amazon Web Services is the biggest player, followed by Microsoft’s Azure.
While two major technology antitrust cases are happening currently in the U.S., they are focusing on different areas of the market. The FTC lawsuit against Amazon announced last month focuses on alleged anticompetitive conduct relating to its online marketplace. Google-parent Alphabet (GOOGL) is in the midst of a trial over accusations from the Justice Department of illegally monopolizing the internet search market.
In the U.K. Amazon reached a deal with the CMA earlier this year over the treatment of third-party sellers on its Marketplace platform.
An Amazon Web Services spokesperson said Thursday that the company disagreed with the regulatory findings about the U.K.’s cloud-computing market and that the cloud had made switching between providers easier.
“Any unwarranted intervention could lead to unintended harm to IT customers and competition. AWS will work constructively with the CMA,” the spokesperson said.
A spokesperson for Microsoft said the company was committed to ensuring the U.K. cloud industry remains “highly competitive” and the company would engage constructively with the CMA.
The CMA’s investigation will conclude by April 2025, the regulator said.
Write to Adam Clark at [email protected]
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