October 6, 2022

The inquiry will focus on so-called “hyperscalers” such as Amazon Web Services and Microsoft Azure, which allow businesses to access computing power and data storage from remote servers.

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UK media regulator Ofcom is investigating the firm hold of Amazon, Microsoft and Google on the cloud computing industry.

In the coming weeks, Watchdog will launch a study that will examine the position of firms offering public cloud infrastructure and whether they pose barriers to competition.

His investigation, announced on Thursday, will focus on so-called “hyperscalers” such as Amazon Web Services, Microsoft Azure and Google Cloud, which allow businesses to access computing power and data storage from remote servers, rather than hosting it on their own private infrastructure.

The regulator could take further action if it finds that the companies are harming competition. Selina Chadha, Ofcom’s director of connectivity, said the regulator had not yet reached a position on whether the cloud giants were engaging in anti-competitive behaviour. Ofcom said it would complete its review and publish a final report with any concerns and proposed recommendations within 12 months.

Amazon, Microsoft and Google were not immediately available for comment when contacted by CNBC.

The review will be part of a wider digital strategy being launched by Ofcom, which regulates the UK’s broadcasting and telecommunications industry

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It also plans to explore other digital markets, including personal messaging and virtual assistants like Amazon’s Alexa, over the next year. Ofcom said it was interested in how services including Meta’s WhatsApp, Apple’s Facetime and Zoom affected traditional calling and messaging, as well as the competitive landscape among digital assistants, connected TVs and smart speakers.

“The way we live, work, play and do business has been transformed by digital services,” Ofcom Chadha said in a statement on Thursday. “But as the number of platforms, devices and networks serving content continues to grow, so do the technological and economic challenges facing regulators.”

“That’s why we’re launching a program of work to examine these digital marketplaces, identify any competitive issues and make sure they work well for the people and businesses that rely on them,” she added.

Ofcom has been chosen as the enforcer of tough new rules to control harmful content on the internet. However, the law, known as the Internet Safety Act, is unlikely to come into effect soon after Liz Truss replaces Boris Johnson as prime minister. With the Truss government grappling with a host of issues in the UK – not least the cost of living crisis – online security regulation is expected to move to the back of the government’s policy priorities.

The move adds to efforts by other regulators to rein in big tech companies because of the perceived pressure they have on various parts of the digital economy.

The Competition and Markets Authority has several active investigations into big tech companies and wants additional powers to ensure a level playing field in digital markets. The European Commission, meanwhile, has fined Google billions of dollars for alleged antitrust violations, is investigating Apple and Amazon in separate cases, and has passed landmark digital laws that could reshape the internet giants’ business models.

Competition in the cloud

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