AWS and Azure are gatekeepers and should be regulated, according to the European Commission
AWS and Azure are gatekeepers and should be regulated, according to the European Commission
The Digital Markets Act of the European Union imposes very strict limits on large tech companies, aiming to protect both users and competitors. The European Commission has now announced its intention to designate AWS and Microsoft Azure as "gatekeepers," with possible restrictions on their activities.
In a statement issued by the Commission, it read that "AWS and Azure, respectively the largest and second-largest cloud computing services in the EU, are an important hub between companies and their customers in the EU. This is true even though they do not exceed the quantitative thresholds set by the DMA for designation [as gatekeepers]."
According to the Commission, "both have large and well-established user bases and appear to benefit from lock-in effects and high switching costs [to other operators], in addition to a large ecosystem" and a dominant position in the AI world.
All these elements combined position the two companies as "gatekeepers," meaning they effectively control a market and position themselves in such a way that they can decide whether other entities have access to that market or not. The designation as "gatekeeper" proposed by the Commission carries with it prohibitions and obligations; among these, we find a ban on imposing bundling (that is, combined offers in which a service or product is only accessible by purchasing another), as well as the obligation to offer interoperability and data portability between platforms.
Currently, this is a preliminary position, to which AWS and Microsoft can respond and oppose. If the designation as "gatekeeper" is confirmed, the two companies will have six months to implement the necessary changes to comply with the DMA, including the elimination of data exit costs and limitations on the use of licenses.
"Cloud services have become a keystone for the European economy and a prerequisite for AI, with over half of companies in the EU relying on them, along with record investments in public cloud infrastructure. Given their central role in Europe's digital future, these services must operate in fair, open, and competitive markets that encourage trust and ensure Europe's technological sovereignty," stated Henna Virkkunen, Executive Vice-President for Technological Sovereignty, Security, and Democracy.