The cloud services offered by Amazon and Microsoft are currently under investigation by European Union regulators, who are considering whether these platforms should be classified as “gatekeepers” under the EU’s Digital Markets Act (DMA). The European Commission announced on Tuesday that it is evaluating whether Amazon Web Services (AWS) and Microsoft Azure should be subject to the DMA’s provisions, which aim to regulate the market power of major technology companies through a series of specified obligations and restrictions, accompanied by significant penalties for violations.
“Cloud computing services are vital for Europe’s competitiveness and resilience. We want this strategic sector to grow on fair, open, and competitive terms. That’s why today we are opening investigations into whether Amazon’s and Microsoft’s leading cloud computing services, Amazon Web Services and Microsoft Azure, should be subject to the Digital Markets Act’s (DMA) obligations. We will also look at whether the DMA’s existing rules need to be updated so Europe can keep pace with fast-evolving practices in the cloud sector,“ announced Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition.
Companies designated as gatekeepers are required to comply with additional responsibilities outlined in the DMA. The Commission has already granted this designation to other services provided by the two firms, including Amazon Marketplace and LinkedIn. This classification is generally based on the number of users, which presents challenges in its application to cloud service providers.
The Commission has stated that it will investigate whether AWS and Azure function as critical gateways between businesses and consumers, even if they do not meet the usual criteria. Market research suggests that cloud service providers, such as AWS and Azure, maintain a strong position with both businesses and consumers. Cloud computing allows organisations to securely access extensive computing resources and services remotely, eliminating the need for substantial investments in physical infrastructure.
The recent Amazon Web Services outage, which disrupted internet services for several hours, highlights the reliance of many digital services—including artificial intelligence—on cloud computing providers.
“We’re confident that when the European Commission considers the facts, it will recognise what we all see,“ Amazon Web Services said in a statement. “The cloud computing sector is extremely dynamic, with companies enjoying lots of choice, unprecedented innovation opportunity, and low costs, and that designating cloud providers as gatekeepers isn’t worth the risks of stifling invention or raising costs for European companies.”
Microsoft said Europe’s cloud sector is innovative and highly competitive. “We stand ready to contribute to the European Commission’s market inquiry,“ it said.
This article used information from The Associated Press.
