EU Probes Amazon, Microsoft Cloud Services Under DMA for Curbs

The European Commission has launched three new market investigations into the cloud computing services of U.S. tech giants Amazon and Microsoft under the Digital Markets Act (DMA). The DMA is the EU's landmark legislation designed to curb the power of Big Tech and ensure fair competition for smaller rivals.

The three separate probes, announced by EU antitrust chief Teresa Ribera, are focused on Amazon Web Services (AWS) and Microsoft Azure, the globally leading cloud providers.

An investigation to assess whether Amazon Web Services (AWS) should be designated as a "gatekeeper" for its cloud computing service under the DMA and a parallel investigation to assess whether Microsoft Azure should be designated as a "gatekeeper." The Commission is probing this despite both services not meeting the usual quantitative thresholds (like market capitalization and user numbers) for designation, arguing they may still act as "important gateways" between businesses and consumers due to their very strong market positions.

A broader market investigation to assess if the DMA's current rules are sufficient to effectively tackle potential anticompetitive practices that may limit competitiveness and fairness in the fast-evolving cloud computing sector, EU antitrust chief Teresa Ribera stated they would assess if the rules need updating to keep pace with the sector's rapid evolution.

If Amazon and Microsoft are designated as gatekeepers for their cloud services, they would be added to the list of "core platform services" already regulated under the DMA. This status mandates strict requirements, such as forcing the companies to make their services interoperable with rivals and prohibiting self-preferencing of their own services.

Violations of the DMA can result in substantial fines of up to 10% of a company's annual global turnover. A Microsoft spokesperson indicated the company is ready to cooperate with the enquiry. Conversely, an AWS spokesperson warned that designating cloud providers as gatekeepers "isn't worth the risks of stifling invention or raising costs for European companies." The move comes amid existing tensions, with U.S. political figures, including President Donald Trump, siding with U.S. tech giants lobbying against stringent EU regulations.

The Commission aims to conclude the individual gatekeeper investigations on AWS and Microsoft Azure within 12 months. The broader investigation into the DMA's application to cloud markets is expected to produce a final report within 18 months.