Ofcom said it had received evidence that Microsoft was making it less attractive for customers to run its Office productivity apps on cloud infrastructure other than Microsoft Azure.
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LONDON — Britain’s competition regulator is developing remedies aimed at addressing competition concerns in the multibillion-pound cloud computing industry.
Two sources familiar with the matter told CNBC that the Competition and Markets Authority is set to unveil its provisional decision on “conduct” remedies to tackle anti-competitive practices in the sector after a months-long investigation into the market. It is Wally.
The sources, who preferred to remain anonymous given the sensitive nature of the investigation, said the cloud market remedy could be announced in the next two weeks. The regulator had earlier set a deadline of November to December 2024 to publish its provisional decision.
A CMA spokesperson declined to comment on the timing of its tentative decision when asked by CNBC.
Cloud infrastructure services is a market dominated by US technology companies. Amazon And Microsoft. Amazon is the largest player in the market, offering cloud services through its Amazon Web Services (AWS) arm. Microsoft is the second largest provider, selling cloud products under its Microsoft Azure unit.
The CMA’s investigation traces its history to 2022, when UK telecoms regulator Ofcom launched a market study to assess the dominance of cloud giants Amazon, Microsoft and others. Google. Ofcom subsequently referred its cloud review to the CMA to address competition issues in the market.
Why is CMA worried?
Among the key issues that the CMA is expected to address with proposed conduct remedies are so-called “egress” fees that companies charge to move data from one cloud to another, licensing Fees are considered unfair, volume discounts, and interoperability issues make it difficult. To change the vendor.
According to one of the sources, Google is likely to be excluded from the scope of competitive treatment because it is smaller in size compared to market leaders AWS and Microsoft Azure.
Amazon and Microsoft declined to comment for this story when contacted by CNBC. Google did not immediately return a request for comment.
What might treatment look like?
The CMA previously said in June that it was more inclined to consider behavioral remedies to address its concerns than “structural” remedies, such as ordering divestment or operational separation.
The watchman said in one Working paper in June that it was “in the early stages” of considering possible treatments.
Solutions proposed at the time included imposing price controls by capping the level of egress fees, reducing technical barriers to switching cloud providers, and forcing firms to spend more in exchange for discounts. included the prohibition of incentive agreements.
A controversial move the regulator said it was considering would require Microsoft to apply the same prices to its production software products regardless of which cloud they are hosted on — a move that would will have a significant impact on Microsoft’s pricing structure.
CMA chief executive Sarah Cardell is due to give a speech at Chatham House, a UK policy institute, on Thursday. In one The interview With the Financial Times, he defended the regulator’s track record on competition enforcement amid criticism from Prime Minister Keir Starmer that the agency was stifling growth.
The FT reported that it will outline plans for a review in 2025 into whether the CMA should use the conduct remedy more often when approving deals.
