- CMA says that the British cloud market is not competitive
- AWS and Microsoft represent 30 to 40% of the British market each
- The two companies do not agree with the conclusions of the AMC
The British Competition and Markets Authority (CMA) has determined that the British cloud market shows too many anti -competitive features, Microsoft and AWS each holding around 30 to 40% of the British market in 2024 and the hyperscalist concentration particularly high in infrastructure as a service.
At the same time, less than 1% of customers change suppliers per year and Multi-Multicloud use is rare (especially among SMEs with more limited budgets).
The ACM blamed high exit costs, incompatible interfaces, latency gaps and skills for the widespread locking of suppliers, which ultimately weakens competition.
CMA worried about AWS and Microsoft Cloud Market Dominance
Behind the two hyperscalers, Google represents only 5 to 10% of the market, others like IBM and Oracle with even smaller actions. Although AI’s capacities were not yet considerably modified the dynamics of the market, the existing positions are likely to be amplified, the AMC therefore intervened to ensure that competition remains healthy.
In its final decision decision, the CMA has won the greatest successes at Microsoft on its unjust license practices, which makes it more expensive to execute Microsoft software on rival cloud suppliers.
A Microsoft spokesperson said Techradar Pro: “The most recent publication of the CMA panel is missing the brand again, ignoring that the cloud market has never been so dynamic and competitive, with record investments, and fast changes and II focused. Its recommendations fail to cover Google, one of the cloud market players who know the fastest growth.”
“Microsoft is looking forward to working with the digital market unit to a result which more precisely reflects the current competition in the cloud that benefits British customers,” they continued.
“The final report of the survey group does not take into account clear evidence of solid competition in the IT services industry of the United Kingdom, which Cloud Computing has revolutionized by considerably reducing costs and widening the choice and flexibility of customers,” said an AWS spokesperson for Techradar Pro.
“The action proposed by the investigation group is unjustified and undermines the substantial investment and innovation which have already benefited hundreds of thousands of British companies. It risks making the United Kingdom a global aberrant value at a time when companies need regulatory predictability for the next stages.”
On the other hand, Google supported the conclusions of the CMA: “The conclusive conclusion according to which restrictive licenses harm clients of the cloud and competition is a moment in the watershed for the United Kingdom.”
Elsewhere in the industry, the AMC was criticized so as not to act quickly enough and approach persistent problems such as cloud credits, locking and supply biases.
“We urge the CMA to use the powers at its disposal now to deal with these misdeeds, rather than embarking on a new survey that may not give customers relief for the coming years,” said the executive director of the fair software license, Ryan Triplette.
In the future, the next AMC’s next step is to designate Microsoft and AWS with the strategic market status (SMS) under the law on digital markets, competition and consumers (DMCC), which allows it to impose legally binding targeted driving requirements on the two giants.
“An important driver of high cloud computing invoices is the consolidation of the market in a handful of players. Until recently, these companies were the only game in town, they were therefore able to establish the market rules, for example, including exit costs, long locking periods, and even more. In fact, Gartner observed that most customers went to 15% of their cloud bills on Egress charges,” Noted Akamai.
“British companies are undergoing pressure on huge costs. We have to facilitate the change of cloud computing suppliers and find pricing options that better correspond to their balance sheets.”
