Amazon, Microsoft Seen As 'Gatekeepers' to Cloud

“The European Union said Amazon.com and Microsoft should be treated as gatekeepers for their cloud-computing services under the bloc's Digital Markets Act, a designation that requires companies to take extra steps to ensure they aren't stifling competition.

 

The European Commission, the EU's executive arm, classified Amazon, Microsoft and other tech giants as gatekeepers for some services years ago, but the bloc said Thursday that it might expand that designation to include their cloud services -- Amazon Web Services and Microsoft Azure.

 

EU officials said AWS and Microsoft Azure had revenue, operations and investments that seemed to have significantly outpaced those of competitors, on top of vast user bases.

 

Officials also referenced their artificial-intelligence tools and partnerships and how the technology is fueling demand for cloud services, saying AWS and Azure appear to retain a large proportion of this demand within their ecosystems.

 

"Given their central role in Europe's digital future, these services must operate in fair, open and competitive markets that foster trust and secure Europe's tech sovereignty," Henna Virkkunen, EU executive vice president, said.

 

The commission said its view that Amazon's and Microsoft's cloud services should fall under the DMA was preliminary, meaning Amazon and Microsoft now have the right to go through the documents that the commission has at its disposal and reply in writing. If EU officials decide to proceed with the designation, the companies would have six months to ensure full compliance with the DMA.

 

"The commission's preliminary findings disregard the breadth of cloud services available to European customers and risk deterring European investment and innovation. AWS faces healthy competition and customers across Europe have more choice, lower prices, and greater flexibility than ever before," an AWS spokesperson said in a statement. AWS said adding another layer of regulation under the DMA risked undermining competitiveness and that the company would continue to engage with the commission on the matter.

 

A Microsoft representative said the company would continue to engage constructively with the commission, noting that the cloud sector in Europe was innovative, highly competitive and a booster for economic growth.

 

The EU launched a probe in November to determine whether AWS and Microsoft Azure should come under the DMA, a law that imposes a set of obligations and prohibitions on companies aimed at preserving competition in the bloc.

 

Gatekeepers have to guarantee their services and those of third parties can work together in certain situations, allow users to access the data they generate on their platforms and let them promote their offer and conclude contracts with customers outside the gatekeeper's platform. Among the prohibitions, gatekeepers can't treat their own services and products more favorably in ranking than what competitors are offering, or track users outside their platform for targeted advertising without consent.

 

Companies that fail to comply with the DMA can be fined up to 10% of annual global revenue, or even up to 20% in case of repeated infringements. The EU can also impose periodic penalty payments of up to 5% of average daily sales.” [1]

 

1. Amazon, Microsoft Seen As 'Gatekeepers' to Cloud. Orru, Mauro.  Wall Street Journal, Eastern edition; New York, N.Y.. 29 June 2026: B4.