UK Launches Investigation Into Microsoft and Amazon’s Cloud Licensing Practices

The UK’s Competition and Markets Authority announced today that it’s launching a new investigation into the public cloud infrastructure services market in the country. This new investigation from the UK regulator follows a market study into the supply of cloud services in the UK from Ofcom, the country’s communications regulator.

The market study from Ofcom highlighted that the cloud services market in the UK currently has financial and technical barriers to switching, with cloud providers making it more advantageous to stick with just one supplier. “Ofcom’s report also outlines concerns it has heard about the software licensing practices of some cloud providers, in particular Microsoft,” the CMA’s press release pointed out today.

If Microsoft is the only cloud provider that the CMA explicitly mentioned today, but it doesn’t mean that market leader Amazon and Google won’t be part of the investigations. Last year, Microsoft made changes to make it be easier and more cost-effective to run its software on other cloud platforms in the EU, but that apparently wasn’t enough.

“This is a £7.5bn market that underpins a whole host of online services – from social media to AI foundation models. Many businesses now completely rely on cloud services, making effective competition in this market essential,” emphasized Sarah Cardell, CEO of the CMA today.

The CMA said that it will conclude its investigations into the supply of public cloud infrastructure services in the UK by April 2025. The UK regulator has had Microsoft in its crosshairs since it blocked the company’s acquisition of Activision Blizzard earlier this year. However, things are now looking up on that front as Microsoft’s restructured deal received provisional approval from the CMA two weeks ago.