Microsoft Azure and AWS Face EU Gatekeeper Designation Under DMA

Last year, the European Commission opened an investigation into Amazon Web Services (AWS) and Microsoft Azure over concerns that their dominance in the cloud computing market could qualify them as “gatekeepers” under the Digital Markets Act (DMA). Now, the first conclusions are in, with regulators signaling that both cloud giants are likely to fall under the EU’s strictest competition rules.

According to the Commission’s preliminary assessment, AWS and Microsoft Azure meet the criteria for designation as DMA gatekeepers. If the decision becomes final, both companies will have six months to comply with a new set of obligations designed to prevent anti-competitive practices and make it easier for businesses to switch cloud providers.

EU says AWS and Azure dominate Europe’s cloud market

Under the Digital Markets Act, companies can be designated as gatekeepers if they meet certain financial and user thresholds or if their services play a critical role in connecting businesses with customers.

The European Commission said AWS and Azure are currently the largest and second-largest cloud computing providers operating in the European Union. Regulators believe both services serve as key gateways for businesses that rely on cloud infrastructure to deliver products and services across Europe.

The Commission also highlighted several factors supporting its preliminary findings, including large annual turnover within the EU, extensive customer bases across multiple industries, strong and entrenched market positions, high switching costs for customers, significant customer lock-in, and operational scale and investment levels that exceed many competitors.

According to the Commission, these characteristics give both companies substantial influence over the European cloud computing market.

Customer lock-in remains a major concern

One of the Commission’s biggest concerns involves the difficulty businesses face when moving workloads from one cloud provider to another.

The preliminary findings suggest that high migration costs and technical dependencies may discourage customers from switching providers, limiting competition in the sector.

The Commission also noted that Amazon and Microsoft continue to invest heavily in expanding their cloud platforms, giving them advantages that smaller rivals may struggle to match.

Executive Vice-President Teresa Ribera said cloud computing has become increasingly important for consumers, businesses, and public administrations across Europe.

She added that the Commission wants to ensure a competitive cloud market while maintaining a level playing field for providers. Ribera also emphasized the importance of secure, sustainable, and interoperable cloud services for the European economy.

Decision is not final yet

The Commission stressed that its conclusions remain preliminary.

Amazon and Microsoft will now have the opportunity to examine the findings and submit their responses before regulators make a final decision.

If the Commission confirms its current view, AWS and Azure will officially become gatekeepers under the Digital Markets Act.

That designation would require both companies to bring their cloud platforms into compliance with the DMA within six months. Depending on the final obligations, the companies could be required to make it easier for customers to switch providers, improve interoperability, and avoid practices that unfairly disadvantage competitors.

The move would mark one of the most significant expansions of the Digital Markets Act into enterprise cloud computing, an area that has become increasingly important as businesses continue shifting critical workloads to cloud infrastructure.

The announcement also comes as the European Union considers additional measures that could restrict how foreign cloud providers handle sensitive government data, potentially introducing another layer of regulation for major cloud companies operating in Europe.