MADRID, 5 Oct. (EUROPA PRESS) –
The UK Competition and Markets Authority (CMA) has decided to launch an independent market investigation into the provision of cloud services at the request of Ofcom, the British telecommunications regulator, which has expressed concerns about the position of the market leaders, Amazon and Microsoft.
The study by Ofcom identified characteristics that make it difficult for UK businesses to switch to multiple cloud providers, with two leading service providers – Amazon Web Services (AWS) and Microsoft – whose combined market share was 70-80. % in 2022, while Google, its closest competitor, had 5-10%.
“We are particularly concerned about the position of market leaders Amazon and Microsoft,” says Ofcom, which calls these companies “hyperscalers”, noting that the vast majority of cloud customers use their services in some way.
According to the British regulator, these market characteristics can make it difficult for some customers to switch or use multiple cloud providers, which can make it difficult to negotiate with their provider or combine better quality services between different providers.
Going forward, he warns that if customers have difficulty switching to multiple providers, it could be more difficult for competitors to gain scale and challenge AWS and Microsoft effectively.
“The high levels of profitability of the market leaders, AWS and Microsoft, indicate that the general level of competition has limits,” notes Ofcom.
Following the referral of the case by Ofcom, the UK Competition and Markets Authority has announced the launch of an investigation to further examine whether competition issues exist and, if so, what interventions can improve the provision of these important services. The CMA plans to conclude its investigation in April 2025.
“This is a £7.5bn market that underpins a host of online services, from social media to basic AI models. Many businesses are now completely reliant on cloud services, making competitive competition essential. effective in this market,” said Sarah Cardell, CEO of CMA.
