The UK’s Competition and Markets Authority (CMA) provisionally found that competition across cloud services was hindered for businesses and organisations due to the dominance of Amazon Web Services (AWS) and Microsoft.

The regulator noted AWS and Microsoft each control around 40 per cent of the UK market for cloud services while Google has a much smaller share.

An independent inquiry group provisionally recommends investigating Microsoft and AWS under the new Digital Markets, Competition and Consumers Act that went into effect earlier this month.

The CMA noted customers such as financial services, retailers, digital start-ups and key public services spent £9 billion on cloud services in 2023, a figure growing by more than 30 per cent each year.

“Effective competition in the delivery of these vital services could drive choice, quality and competitive prices, not only helping UK businesses but boosting innovation, productivity, growth and investment across the UK economy,” the CMA stated.

Kip Meek, chair of the CMA’s inquiry group, stated “competition in this market is not working as well as it could be” which is why the group is proposing the CMA conduct an investigation of “the largest cloud service providers using its new digital markets powers”.

A representative for AWS told Mobile World Live (MWL) the proposed investigation “is not warranted” and urged “the CMA to carefully consider how regulatory intervention in other areas will stifle innovation and ultimately harm consumers in the UK”.

A representative for Google told MWL “restrictive licensing harms UK cloud customers, threatens economic growth, and stifles innovation, and we are encouraged that the CMA has recognised the harm of these practices”.

The UK regulator will make a final decision by the statutory deadline of 4 August 2025.

The CMA started its investigation into the cloud services market in October 2023 based on a recommendation from Ofcom.