Ofcom is proposing to refer the UK cloud infrastructure service market to the Competition and Markets Authority for further investigation.
The communications regulator is at the halfway point of its investigation into a sector dominated by Amazon Web Services (AWS) and Microsoft that between them have a combined market share of 60-70%.
Google is their closest competitor with a share of 5-10%.
In a statement, Ofcom said that while market forces are delivering benefits to customers – especially where providers are competing to attract new customers – other features of the market give cause for concern, such as egress fees; technical restrictions on interoperability; and committed spend discounts.
An AWS spokesperson told Broadband TV News: “These are interim findings and AWS will continue to work with Ofcom ahead of the publication of its final report. The UK has a thriving and diverse IT industry with customers able to choose between a wide variety of IT providers. At AWS, we design our cloud services to give customers the freedom to build the solution that is right for them, with the technology of their choice. This has driven increased competition across a range of sectors in the UK economy by broadening access to innovative, highly secure, and scalable IT services.” –
The Competition and Markets Authority will now carry out a market investigation. This would allow the CMA to further examine the nature and extent of barriers and consider if there are interventions that could improve how the market works for customers and UK consumers.
