Saturday, October 12, 2024

CMA postpones report into state of UK cloud market – UKTN

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The UK’s competition regulator has pushed back the deadline for its report into the state of the UK’s cloud market as it embarks on a deeper probe into the industry.

The Competition and Markets Authority today said it had extended the deadline by four months, from its original date of 4 April 2025 to 4 August 2025.

The CMA said it needed more time to investigate more issues of harm in the market and prepare a deeper analysis of the “complex matters raised,” for which the earlier publication date did not allow enough time.

“In taking this decision, the Inquiry Group has had regard to the nature and complexity of issues raised in relation to the theories of harm investigated, in particular, the licensing practices theory of harm, which was not examined in depth in Ofcom’s market study,” the CMA said.

“Specifically, the inquiry group had regard to the submissions, evidence and analyses provided in response to the CMA’s working papers and the main party hearings, some of which were received after the deadline for submission of evidence as set out in the administrative timetable.”

As part of its submission of evidence to the CMA’s investigation, Google this week issued a rare rebuke against one of its biggest tech rivals after it accused Microsoft of ‘significantly impeding customer choice’ in the UK cloud market.

The search engine giant said Microsoft’s software licensing practices impose restrictions which “risk irreversibly tilting the market in Microsoft’s favour at a pivotal moment” and that “technical barriers are amplifying the effects of these practices.”

Google said that Microsoft’s licensing restrictions prevent it and others from competing for most of this addressable market, adding: “urgent and timely action is necessary to address Microsoft’s practices.”

Google’s diatribe was backed up with comments by Amazon’s AWS, which said there is “a history of cloud providers and customers being unhappy with Microsoft’s conduct,” adding that Microsoft’s “conduct is artificially imposed and could be easily fixed.”

Microsoft said it “believes the CMA’s emerging views on the competitive landscape and market outcomes disregard real world evidence that the market is highly dynamic and rapidly evolving.”

In October last year, the CMA expressed concerns that dominant players like Amazon and Microsoft unfairly disincentivise customers from using smaller providers, while media regulator Ofcom said it was concerned about high exit fees charged by cloud providers as well as interoperability barriers that have been artificially raised to make it hard to switch providers.

According to an Ofcom study published last year, the UK cloud market is dominated by three main players, with Amazon and Microsoft each accounting for around 30-40% of total revenues and Google representing around 10%.

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