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The clouds are gathering over Microsoft\u2019s Azure operations in the EU and now the UK, with the launch of a new investigation into major cloud service providers that also includes Amazon. The UK\u2019s Competition and Markets Authority (CMA) is just about to wrap up its concerns<\/a> over cloud gaming with Microsoft\u2019s proposed Activision Blizzard acquisition, but it will soon turn its attention to Microsoft\u2019s Azure cloud offerings and Amazon Web Services (AWS).<\/p>\n<\/div>\n It\u2019s part of a fresh investigation<\/a> into public cloud providers in the UK, after telecoms regulator Ofcom \u201cidentified a number of features in the supply of cloud services that make it more difficult for customers to switch and use multiple cloud suppliers.\u201d<\/p>\n<\/div>\n Ofcom found issues with charges that cloud customers have to pay to move their data out of the cloud, discounts to only use one cloud provider, and technical barriers to switching between cloud providers. The CMA specifically calls out Microsoft, too. \u201cOfcom\u2019s report also outlines concerns it has heard about the software licensing practices of some cloud providers, in particular Microsoft,\u201d says the CMA in its press release<\/a> today.<\/p>\n<\/div>\n Telecoms regulator Ofcom found issues with cloud services in the UK<\/p>\n<\/div>\n<\/div>\n \u201cThe CMA\u2019s independent inquiry group will now carry out an investigation to determine whether competition in this market is working well and if not, what action should be taken to address any issues it finds,\u201d says Sarah Cardell, CEO of the CMA.<\/p>\n<\/div>\n Although the CMA doesn\u2019t specifically name Amazon, Ofcom\u2019s market study<\/a> identified that both Microsoft and Amazon control around 70-80 percent of the public cloud infrastructure in the UK and that it was \u201cparticularly concerned about the practices of Amazon Web Services (AWS) and Microsoft\u00a0because of their market position.\u201d<\/p>\n<\/div>\n Ofcom and the CMA aren\u2019t alone in their concerns over cloud market competition, either. The Cloud Infrastructure Services Providers in Europe (CISPE) trade group, which includes Amazon, filed an antitrust complaint<\/a> with the EU last year. The group argues \u201cMicrosoft uses its dominance in productivity software to direct European customers to its own Azure cloud infrastructure to the detriment of European cloud infrastructure providers and users of IT services.\u201d<\/p>\n<\/div>\n Microsoft offered some licensing concessions<\/a> more than a year ago, but they haven\u2019t been enough to address the ongoing complaints. Google even publicly called out Microsoft\u2019s cloud software licensing \u201ctax\u201d earlier this year, arguing that businesses have to pay extra when they want to run software like Office on other cloud networks.<\/p>\n<\/div>\n \u201cMicrosoft publicly touts that if you run their software on Azure versus other vendors like AWS and GCP, it\u2019s five times cheaper or it\u2019s more expensive to run on us, basically because of the tax customers have to pay to Microsoft,\u201d said Amit Zavery, head of platform at Google Cloud, in an interview with The Register<\/em><\/a> earlier this year. \u201cThe price of the products are the same in terms of infrastructure and everything else, so the licensing cost is more expensive because of using providers other than Azure.\u201d<\/p>\n<\/div>\n The CMA\u2019s market investigation could take 18 months to complete, with a statutory deadline set for April 4th, 2025. The UK regulator will outline theories of harm and any potential remedies that might address the situation. The UK regulator also has the power to \u201cimpose structural remedies which can require companies to sell parts of their business to improve competition.\u201d<\/p>\n<\/div>\n