The European Commission has taken a significant step toward extending its landmark digital competition framework to cloud computing, issuing preliminary findings that Amazon Web Services (AWS) and Microsoft Azure should be designated as “gatekeepers” under the European Union’s Digital Markets Act (DMA).
According to Reuters, which first reported the development, the Commission reached its initial conclusions following a seven-month market investigation into whether the two cloud platforms hold entrenched positions that justify additional regulatory obligations. Reuters reported that the findings are preliminary, giving both companies an opportunity to respond before regulators issue a final decision in the coming months.
If the designation is confirmed, AWS and Azure would become the first major cloud infrastructure providers subject to the DMA’s gatekeeper rules. The law, which has already been applied to services such as online search, app stores and social media platforms, imposes restrictions designed to prevent dominant technology companies from using their market power to disadvantage competitors.
Among other obligations, designated gatekeepers must avoid self-preferencing their own services, facilitate interoperability with competing platforms, and make it easier for customers to transfer data between providers.
The Commission said cloud computing has become increasingly central to Europe’s economy, particularly as businesses expand their use of artificial intelligence and digital services. EU Technology Commissioner Henna Virkkunen said cloud infrastructure now serves as a foundation for both commercial operations and AI development, making competitive market conditions increasingly important for Europe’s digital economy. Reuters reported that more than half of EU businesses now rely on cloud services, while investment in public cloud infrastructure continues to grow.
Competition concerns have become a central focus of the Commission’s review. Reuters reported that regulators cited AWS and Azure’s substantial revenues, large installed customer bases, extensive operational scale, significant investment capacity, and high customer switching costs as evidence of durable market power. The Commission also highlighted the companies’ expanding artificial intelligence capabilities and strategic partnerships as factors reinforcing their competitive positions.
Read more: EU Weighs New Competition Obligations for Major Cloud Providers
The investigation reflects a broader evolution of European antitrust policy. While the DMA initially focused on consumer-facing digital platforms, regulators are increasingly examining foundational technology infrastructure where businesses may face limited alternatives and substantial barriers to changing providers. The cloud sector has drawn growing attention because of concerns over vendor lock-in, interoperability, and the concentration of computing resources essential for AI development.
Amazon challenged the Commission’s preliminary assessment. According to Reuters, AWS argued that European customers benefit from a broad and competitive cloud marketplace and warned that layering DMA obligations on top of existing legislation, including the EU Data Act, could discourage investment and weaken Europe’s competitiveness in advanced information technology.
Microsoft also pushed back, although it emphasized competitive dynamics involving another major cloud provider. Reuters reported that Microsoft argued regulators were overlooking Google’s expanding position in cloud computing and artificial intelligence, stating that failing to account for Google Cloud and its Gemini AI offerings could distort competition.
The latest action comes amid a wider European effort to strengthen oversight of cloud infrastructure and reduce strategic dependence on foreign technology providers. Earlier this month, Reuters reported that the European Commission proposed new cloud procurement rules for sensitive public-sector contracts as part of its Cloud and AI Development Act, a broader initiative aimed at enhancing European technological sovereignty and supporting domestic digital capabilities.
The DMA, which entered into force in 2022, forms a cornerstone of the EU’s digital competition strategy by imposing ex ante obligations on companies deemed to control essential digital gateways. Unlike traditional antitrust enforcement, which typically addresses conduct after alleged violations occur, the legislation seeks to prevent anti-competitive behavior before it harms market competition.
Amazon and Microsoft will now have the opportunity to submit formal responses to the Commission’s preliminary findings before the regulator determines whether AWS and Azure will be formally designated as gatekeepers under the Digital Markets Act, Reuters reported.
Source: Reuters
