Cloud providers push for UK action as CMA weighs oversight of AWS, Microsoft

A growing number of cloud providers say the United Kingdom’s cloud computing market needs immediate regulatory attention as the Competition and Markets Authority prepares to decide whether to formally investigate Amazon Web Services and Microsoft Azure under the country’s digital markets framework.

The call for action comes from research commissioned by the Open Cloud Coalition, an industry advocacy group representing alternative infrastructure providers. The survey results suggest many companies believe the current market structure favors a small group of hyperscale providers and leaves limited room for smaller competitors to expand.

According to the findings, more than seventy percent of respondents described regulatory intervention as urgent or extremely urgent. At the same time, nearly three quarters said dominant cloud providers will likely strengthen their market position if regulators do not act soon.

The CMA has already examined the UK cloud sector and published a report last year that highlighted structural competition concerns. In that report, the regulator described the market as highly concentrated, with AWS and Microsoft Azure holding the largest share of enterprise cloud infrastructure. The investigation also highlighted the issues that might deter customers from changing their service provider after using a specific platform.

The investigation identified several issues, including software licensing practices, bundled services, and committed spending contracts that might limit organizations from considering other service providers. The CMA also identified that the problem of interoperability might limit the migration of businesses that intend to switch from their current platforms.

The Open Cloud Coalition survey findings also highlight several of these issues. Over eighty percent of the cloud providers who participated in the survey reported that they experienced difficulties when they attempted to compete with other service providers. Respondents cited licensing constraints, bundling strategies, and interoperability limitations as challenges that affect competition.

Industry observers also warn that delays in regulatory action could affect customers directly. Many buyers surveyed expect higher costs if market concentration continues, while others anticipate reduced flexibility when choosing infrastructure providers.

The CMA will decide by the end of March whether it will grant AWS and Microsoft Strategic Market Status under the United Kingdom’s digital markets regime. That designation would give regulators authority to introduce targeted measures designed to address competition concerns in specific areas of the market.

The impending decision will be significant for cloud consumers and providers of infrastructure because of the potential impact that it has on the evolution of competition in the UK cloud environment.