European Commission to investigate AWS and Microsoft Azure

The move comes shortly after Apple and Meta were fined hundreds of millions for not abiding by the DMA rules

The European Commission has opened three market investigations into cloud computing services under the Digital Markets Act (DMA), two of which focus on AWS and Microsoft Azure.

Two probes will examine whether Amazon and Microsoft should be designated as “gatekeepers” for their cloud computing services, despite not meeting the DMA’s size, user number, and market position thresholds.

Gatekeepers, as defined by the European Commission, are large digital platforms acting as essential gateways between businesses and consumers.

A third investigation will consider whether the DMA’s current rules are sufficient to address practices that could restrict competition or fairness in the EU’s cloud computing sector.

The Commission will aim to conclude the market investigations on Azure and AWS within 12 months.

A final report is also to be published within 18 months, which may propose updates to the DMA concerning cloud through a delegated act.

If AWS and Azure are designated as gatekeepers for cloud, they would be added to the list of core platform services for which both of their parent organisations are already classified.

They would then have six months to ensure full compliance of their cloud computing services with the DMA obligations.

The investigation will cover issues including interoperability barriers between cloud platforms, limited or conditioned access for business users to data, tying and bundling services, and potentially imbalanced contractual terms.

“Cloud computing services are vital for Europe’s competitiveness and resilience,” said Teresa Ribera, EVP of the European Commission for a Clean, Just, and Competitive Transition.

“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, AWS and Microsoft Azure, should be subject to the 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. “

Henna Virkkunen, EVP of the European Commission for Technological Sovereignty, Security, and Democracy, added: “With today's market investigations we want to assess whether Amazon and Microsoft with their cloud services AWS and Microsoft Azure qualify as gatekeepers - and if yes, how to ensure an effective application of the Digital Markets Act in cloud computing services.”

The DMA, introduced in 2022, aims to prevent big tech companies from abusing their power.

In addition to Amazon and Microsoft, current gatekeepers include Alphabet, Apple, Booking, ByteDance, and Meta.

In April, Apple was fined €500m (£441.3m) for breaching anti-steering rules, while Meta received a €200m penalty for failing to offer users a genuine choice over data-tracking,

This also comes as cloud providers are under deep scrutiny in Europe.

In July, CISPE appealed before the General Court of the EU against the European Commission's decision to approve Broadcom's acquisition of VMware.

In May, a report by the European Cloud Competition Observatory (ECCO) group stated the current VMware licensing model relies on practices that appear to breach European competition regulations, while Broadcom’s overall business model “remains legally and ethically flawed,” according to the organisation.