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Microsoft and Amazon have a combined market share of 60pc to 70pc in the UK cloud services market, according to a report by Ofcom.
Big Tech players Microsoft and Amazon have been singled out by the UK’s media and comms regulator Ofcom over their alleged anticompetitive practices.
The two companies could face an antitrust investigation in the UK after the watchdog said it was “particularly concerned about the practices of Amazon and Microsoft because of their market position.”
Ofcom made the comment on foot of a report it released yesterday (5 April) on the UK’s cloud services market.
Amazon’s AWS and Microsoft are the leading providers of cloud services in the UK, the report found. They have a combined market share of 60pc to 70pc. Google, their closest competitor, has a market share of 5pc to 10pc.
Ofcom said it carried out the market study to ensure that the cloud market is operating fairly and competitively as cloud computing “has become critical for many businesses across the economy”.
The watchdog has been looking into cloud infrastructure services for some time now as part of a bid to remove anticompetitive practices.
It said that while competitive market features were providing some benefit to consumers, “other features of the market give cause for concern”.
Ofcom identified these as egress fees, committed spend discounts and technical restrictions on interoperability.
“These market features can make it difficult for some existing customers to bargain for a good deal with their provider. There are indications this is already causing harm, with evidence of cloud customers facing significant price increases when they come to renew their contracts,” Ofcom said.
It said it has proposed to refer the cloud infrastructure market to the UK’s competition regulator, the CMA, to carry out a market investigation.
“This would allow the CMA to further examine the nature and extent of barriers and consider if there are interventions that could improve how the market works for customers and ultimately UK consumers,” it added.
Ofcom confirmed that it would continue to engage with the CMA during its investigation. Ahead of any referral that could take place, Ofcom said it intends to publish a final report setting out its findings and recommendations, including its final decision on a market investigation reference, by no later than 5 October.
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