EU regulators have squeezed the big tech cloud market

The three big cloud service providers — Amazon Web Services, Microsoft Azure and Google Cloud — account for nearly three-quarters of the European cloud market, according to the data. published by Synergy Research Group.

And although all three companies have been subject to various antitrust investigations in the EU over the years, their respective cloud companies have yet to feel the full force of European competition law.

However, the European Commission (EC) was Microsoft investigation for anticompetitive practices after complaints were filed by competing cloud providers, including Germany’s Nextcloud and France’s OVHcloud, last year.

Read more: Microsoft faces cloud-based antitrust complaints in Italy, Denmark

No official investigation has since been opened, but one has been carried out the changes Microsoft’s outsourcing and hosting terms in October were widely seen as an attempt to allay EU antitrust concerns.

The revised terms are intended to make it easier for users of Microsoft software products to be deployed on non-Azure cloud servers that are part of Big Tech previous commitments To support European cloud providers.

However, the recent amendments were not enough to prevent the Consortium of Cloud Infrastructure Providers in Europe (CISPE) from submitting applications Another complaint with the European Commission earlier this month, alleging that the new terms not only fail to address Microsoft’s abuse of the marketplace, but add unfair new practices to its contractual requirements.

“Microsoft’s continued attitude and behavior is irreparably harming the European cloud ecosystem and denying European customers choice in their cloud deployments,” CISPE stated, urging the European Commission to launch a formal inquiry.

Besides Microsoft, CISPE also has it Accusation of restrictive licensing arrangements against Oracle and SAP.

While Azure has come under fire from competitors in the cloud provisioning space, Microsoft has also been accused of unfairly bundling products with another cloud service – OneDrive.

a alliance of EU based IT companies have added their support to a complaint Nextcloud filed it with the EC, claiming that Microsoft is limiting consumer choice and erecting barriers for other market participants by “pushing hard” OneDrive, Teams and other services on Windows users.

In both cases, software developers who want to market and sell their products to Microsoft customers have accused the company of monopolistic practices that prevent third parties from interacting freely with Microsoft services either through restrictive contracts or by making it very difficult to do so.

Many of the companies that joined OneDrive’s complaint against Nextcloud would also benefit from opening up Azure’s legal and technical requirements, while the likes of Cozycloud and Aquaray are in the same boat as AWS, competing directly with Microsoft in the market for cloud hosting services.

Related: The European Commission is proposing to change the definition of the market to consider digital ecosystems

UK opens cloud market probe

What’s interesting about the latest development is that CISPE counts AWS among its members, indicating that the global leader in the cloud market is confident it will benefit from a cloud ecosystem in which developers have more flexibility to mix and match different cloud services. providers.

But while AWS might feel safe that it would benefit from a more open cloud market, Ofcom, the British telecoms organization, has named all three of the technology’s big cloud providers in its position Initial market investigation.

In a call for input, the regulator cited Synergy’s research indicating that the dominance of the big three providers is more pronounced in the UK than in Europe as a whole – accounting for an estimated 81% of sales of public cloud infrastructure services in the country in 2021.

With public consultation now closed, Ofcom will conduct a market study over the next year, with a final report published no later than 5 October 2023.

The regulator states that it “will explore the extent of interoperability between services of different providers, how easy it is for customers to move workloads and data between suppliers, and how easy it is for customers to change suppliers or use more than one supplier.”

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