Channel weighs in on CMA UK cloud market investigation
CRN canvassed four channel companies for their initial thoughts on the dominance of cloud hyperscalers in the UK
Last week news broke that Ofcom had recommended an inquiry into the UK's cloud market to the Competition Markets Authority (CMA).
The watchdog will be investigating anti-competitive practices within the cloud industry following Ofcom's own study into the market, as the likes of AWS and Microsoft dominate the space.
Areas likely to be investigated include egress fees, data portability and interoperability.
The probe is anticipated to last up to 12 months, with AWS outright disagreeing with the inquiry.
"We disagree with Ofcom's findings and believe they are based on a fundamental misconception of how the IT sector functions, and the services and discounts on offer," an AWS spokesperson said.
"AWS designs cloud services to give customers the freedom to choose technology that best suits their needs.
"UK companies, and the overall economy, benefit from robust competition among IT providers, and the cloud has made switching between providers easier than ever.
"Any unwarranted intervention could lead to unintended harm to IT customers and competition. AWS will work constructively with the CMA."
To get a wider view on the matter, CRN spoke with a number of channel players to hear their initial thoughts.
Solange Viegas Dos Reis, chief legal officer, OVHcloud
"Ofcom's final report on the cloud market cannot be any clearer. As highlighted by OVHcloud and many competition authorities over the world, the cloud market suffers from major competitive dysfunctions whose practices hurt not only competition but ultimately consumers.
"With Ofcom acknowledging these practices we are eager for wider probes into the cloud playing field and call on public authorities to take rapid actions."
Channel weighs in on CMA UK cloud market investigation
CRN canvassed four channel companies for their initial thoughts on the dominance of cloud hyperscalers in the UK
Jack Watson, managing director, Bytes Software Services
"I think both Microsoft and AWS have invested heavily in their platforms and their position in the market reflects that contribution.
"They went early, and offer the most advanced, most developed, and most capable enterprise cloud platforms available.
"Where cloud providers offer the most advantageous discounts, they do so to promote their cloud native toolsets like AWS Lambda or Azure Cosmos which seems fair given they are their proprietary services.
"That said, I think egress charges from some hyperscalers are unpopular with many customers. The feeling is that egress charges can influence workload placement and the selection of services outside AWS or Azure because of the fees involved.
"Overall, it's normal to expect software vendors to offer better pricing for placing more business through them and allow customers to benefit from the economy of scale. There are no technical barriers to switching cloud providers that I'm aware of, so I don't anticipate any change."
Channel weighs in on CMA UK cloud market investigation
CRN canvassed four channel companies for their initial thoughts on the dominance of cloud hyperscalers in the UK
Josh Boer, director at tech consultancy, VeUP
"As businesses increasingly make the switch to cloud, it is good to see the CMA paving the way for increased supply and widespread adoption of cloud services for businesses.
"Over the coming years, it is expected that more businesses will transition to the cloud, taking advantage of cost optimisation as a top priority, while alleviating the concerns of AWS billing and cost management.
"AWS in particular offers businesses the ability to increase agility, drive down costs and promote innovation, tapping into a suite of tailored services catering to their unique organisational requirements.
"However, if cloud services provide businesses with cost-related issues, the appeal can significantly decrease meaning providers must address this to allow businesses to optimise the benefits of cloud and navigate market shifts through scalable resources."
Channel weighs in on CMA UK cloud market investigation
CRN canvassed four channel companies for their initial thoughts on the dominance of cloud hyperscalers in the UK
Eamonn O'Neill, co-founder and chief technology officer, Lemongrass
"American hyperscalers were the first to recognise and capitalise on the potential of cloud computing.
"Their early market entry with a global mindset allowed them to establish a strong foundation, offering datacentres worldwide tailored to regional needs - ensuring each local customer receive localised services.
"Their innovation and demonstrated value to the sector is undeniable. Yet, both the UK and wider European markets currently lack their own major hyperscalers. The forthcoming review by the Competition and Markets Authority might prompt more local innovation and perhaps drive further choice for customers."