The European Commission has launched three market investigations into AWS and Microsoft Azure under the Digital Markets Act (DMA), a framework aimed at curbing the power of large technology platforms, designated as “gatekeepers,” and ensuring fair competitive conditions for smaller rivals.
The investigations are organized into three distinct strands:
Designation as ‘gatekeepers’. Through two inquiries, the Commission will assess whether Amazon Web Services (AWS) and Microsoft Azure should be designated as “gatekeepers” for their cloud services. If this designation is confirmed, these cloud services would be added to the list of essential platform services for which Amazon and Microsoft are already regarded as gatekeepers.
DMA effectiveness in the cloud. This third inquiry aims to evaluate the effectiveness of the current DMA obligations in countering unfair or anti-competitive practices in the cloud sector. The review focuses in particular on interoperability barriers, limited data access for business users, bundled and tied services, and potentially unbalanced contractual terms.
The DMA criteria
The DMA, which came into force in 2023, defines a “gatekeeper” as a company offering an essential platform service with more than 45 million monthly active users and a market capitalization of at least €75 billion (about $86.87 billion). AWS is the world’s largest cloud provider, holding around 30% of the market, followed by Microsoft Azure (20%) and Google Cloud (13%).
Companies designated as “gatekeepers” are required to make their services interoperable with those of their competitors and cannot favor their own services over those of rivals. In case of DMA violations, companies face fines of up to 10% of their worldwide annual turnover.
The EU antitrust chief, Teresa Ribera, said the Commission will also seek to determine whether “the existing rules of the Digital Markets Act need to be updated so Europe can keep pace with the rapid evolution of cloud computing practices.”
A Microsoft spokesperson said the company stands ready to contribute to the inquiry.
On the AWS side, the company argued that “designating cloud providers as gatekeepers is not worth risking stifling innovation or increasing costs for European businesses.”
The Commission aims to complete the two investigations into the designation of AWS and Azure within 12 months. The review of the DMA’s application to cloud markets will result in the publication of a final report within 18 months.
