It was discovered that Amazon's AWS and Microsoft's Azure are being investigated by a British government agency for violating antitrust laws over complaints that they are ``deliberately making it difficult to switch between clouds.''
Companies such as Amazon and Microsoft offer their own cloud computing services, such as
Cloud computing services provided by Amazon, `` Amazon Web Services (AWS)'' and `` Microsoft Azure (Azure)'' provided by Microsoft, maintain large shares in the industry. However, it has been pointed out that AWS and Azure may violate antitrust laws, and in response to this, it has been revealed that the UK Competition and Markets Authority (CMA) has launched an investigation.
CMA launches market investigation into cloud services - GOV.UK
https://www.gov.uk/government/news/cma-launches-market-investigation-into-cloud-services
UK regulator launches antitrust probe into Microsoft and Amazon cloud services | Network World
Ofcom refers to UK cloud market to CMA for investigation - Ofcom
Cloud Computing Monopolies Challenged: UK Regulator Takes on Tech Giants
https://www.linkedin.com/pulse/cloud-computing-monopolies-challenged-uk-regulator-takes-hansford
In April 2023, the UK's communications regulator Ofcom said AWS and Azure 'hinder competition in the cloud computing services market, making it difficult to switch between clouds and preventing them from maintaining top market share.' 'I am,' he claimed .
According to an Ofcom survey, AWS and Azure account for approximately 60 to 70% of the share of cloud computing services in the UK, with Google's cloud computing service Google Cloud Platform (GCP) coming in second place with a share of 5. It has been reported that there is a large difference between ~10% and 10%.
Ofcom cites ``high data communication charges,'' ``limited interoperability,'' and ``committed use discounts'' as concerns about AWS and Azure's oligopoly in the UK cloud computing services market.
Regarding ``high data usage,'' Ofcom says, ``The data usage that customers pay when transferring data from the cloud is extremely high for major cloud computing services such as AWS and Azure compared to competitors' services. 'The high cost of data communication makes it difficult for customers to subscribe to multiple services at the same time or switch to another service.'
Regarding ``limitations on interoperability,'' ``When performing a switching operation that crosses carriers, such as switching from AWS to Azure, the switching process becomes extremely difficult because the systems of each carrier are different. 'This lack of interoperability inhibits competition by locking in customers and making it difficult to migrate to other services.'
Furthermore, regarding ``committed use discounts'', Ofcom points out that ``committed use discounts'' such as AWS's `` Compute Savings Plans, '' which reduce the final cost of using services by entering into long-term contracts of one or three years with consistent computing usage. The system may amount to anti-competitive behavior as it makes it difficult for customers to switch to someone else's service.'
Fergal Faragher, director of market research at Ofcom, said: ``Some UK businesses are finding it difficult to find the lowest cost combination when switching cloud computing service providers or subscribing to multiple services.'' 'We are concerned that the market for cloud computing services in the UK is not working properly, and we question whether competition in the market is working properly.' 'We are working to ensure that our customers continue to benefit from the right cloud computing services.'
Ofcom commissioned a market investigation from the CMA on 5 October 2023. As a result, the CMA has asked whether there are any competitive concerns about AWS or Azure, and if so, what steps can be taken to ensure that UK customers are adequately served. We have started an investigation.
Sarah Cardell, CEO of the CMA, said: 'The CMA very much welcomes Ofcom commissioning us to investigate. In the UK, a large number of online services use cloud computing services, from using social media to developing AI models. In the UK, many businesses are dependent on cloud services, so we are looking to find a suitable and effective way to serve this market. It is essential that there is strong competition.'
However, Amazon spokesperson Harry Streit said: 'We are not satisfied with the results of Ofcom's preliminary investigation. Ofcom appears to have misunderstood the services and discounts we offer.' I object to this. It also points out, ``While the CMA and Amazon will cooperate with each other in the investigation, unreasonable interference may cause unintended harm to customers and competition.''
The CMA investigation will begin on October 5, 2023 and will run until April 4, 2025.
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