The UK's Competition and Markets Authority (CMA) has completed a 16-month investigation into the cloud services market, particularly focusing on Amazon Web Services and Microsoft, which dominate with a combined market share of 30-40%. The CMA identifies barriers for alternative suppliers and challenges that prevent customers from switching providers easily. With UK businesses spending £9 billion on cloud services in 2023, the CMA warns that even small price increases could collectively cost £430 million annually. The CMA proposes a Strategic Market Status designation for AWS and Microsoft to enhance competition.
The CMA's investigation reveals barriers for alternative cloud suppliers, limiting their market entry and expansion, while also posing challenges for customers switching providers.
UK businesses increased cloud services spending by 30 percent annually, indicating significant market growth while raising concerns about pricing and competition.
The CMA suggests a Strategic Market Status designation for AWS and Microsoft to bolster competition, essential given both companies' dominance in the market.
CMA highlights that even a small increase in prices over time due to market inefficiencies could lead to excessive annual costs for UK businesses.
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